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TMI Blog2019 (6) TMI 1656X X X X Extracts X X X X X X X X Extracts X X X X ..... ts belonging to the assessee.- Decided against revenue. - WTA No. 15/Mum/2017, WTA No. 16/Mum/2017, WTA No. 17/Mum/2017 - - - Dated:- 21-6-2019 - SHRI G.S. PANNU, VICE-PRESIDENT AND SHRI PAWAN SINGH, JUDICIAL MEMBER For the Appellant : Ms S. Padamja CIT-DR/Shri Rajeev Gubgotra (SrDR) For the Respondent : Shri Vijay Mehta with Shri Anuj Kisnadwala (AR) ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER; 1. This group of three appeals by revenue are directed against the order of Commissioner of Wealth Tax (Appeals) Pune-11, dated 15 June 2017, hereinafter referred as ld. Commissioner (Appeals) , for assessment years 2010-11 to 2012-13. The ld. Commissioner (Appeals) passed consolidated order in all cases. In all appeals the revenue has raised identical grounds of appeal. Therefore, all these appeals clubbed, heard and are decided by common order for the sake of brevity. The appeal for assessment year 2010-11 is treated as lead case. In appeal for assessment year 2010-11, the revenue has raised following grounds of appeal: 1. On the facts and circumstances of the case and in law, the Ld. CWT (A) erred in not appreciating the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lities. The assessee acquired about 1600 acres of land in District Panvel, from Government of Maharashtra in financial year 2008- 09 and 2009- 10 for development of a township. A search and seizure operation was carried out by the revenue under section 132 of the Income Tax Act, on assessee group on 10th April 2013. Consequent upon the search action the case of assessee was reopened on 25th February 2015 by issuing notice under section 17 of Wealth Tax Act (Act). In response to the notice, the assessee filed its return of Wealth on 24.02.2016 showing net Wealth at Nil. The Assessing Officer issued notice under section 16(2) on 09.03.2016 and 16(4) dated 17.03.2015 and 27.01.2016 which were duly served upon the assessee. For compliance of notices the assessee filed its reply on 23 March 2016. The assessee was served with the following reasons: Satisfaction Note Wealth (Urban Land) escaping assessment in the case of M/s valuable Properties Private Limited- PAN -AA CC V 4657K AY 2010-11 On the basis of the return of income, balance-sheet is and other documents in the case of assessee, Valuable Properties Private Limited (VPPL) the issue of taxability under the Wealth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was granted was aimed at allowing entities to hold land in excess of the ceiling laid out in the law for maximum land holding. The purpose of the amendment and the section was to allow the investor company to hold land for the sole purpose of development of infrastructure. Therefore, the first condition placed upon the assessee in the said GR is that the applicant M/s Valuable Properties Mumbai, would buy agriculture land for the use of setting up Special Township alone. Thus it is clear that the land held by the assessee is for the purpose of industrial purpose and not meant for agriculture operation. Further investigation has proved that the land is within 8 km of the municipal limits of Panvel Municipal Corporation. In the instant case, request was made to the Director of survey of India, Maharashtra and Goa, Geo Spetial Data Centre, Pune to verify whether the land purchased by the proposed site of Energy City falls within the jurisdiction of 8 km from the outer limits of Panvel Municipal Council. After detailed verification, the Director of Survey of India, vide its letter No. T-444/40-O(Proj Gen) dated 02.06.2013 furnished that all these land falls within the Municipal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led from the Director, Survey of India, Maharashtra and Goa, Pune. The Director of Survey of India, vide its reply dated 12th June 2013 intimated that impugned land falls within 8 km of Panvel Municipal Council. It was argued that the land acquired by the assessee remained unused for more than three years from the date of acquisition. The said land is part of Wealth of assessee as no work was started on it. The ld. Commissioner (Appeals) silently treated the said land as Stock in Trade. In support of her submission the learned DR for the revenue relied upon the decision of Hon ble Supreme Court in Giridhar G. Yadlam Vs CWT [384 ITR 52 SC]. 6. On the other hand the learned AR for the assessee supported the order of ld. Commissioner (Appeals). The learned AR further submits that the statute itself excepted, interalia the three categories of land from Urban Land , (i) land occupied by any building which has been constructed with the approval of appropriate authority or, (ii) unused land held by assessee for industrial purpose for a period of two years from the date of its acquisition, or (iii) land held by the assessee as its Stock in Trade for a period of 10 years from the date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9. The learned AR further submits that as per section 2 (m) of Wealth Tax Act, while determining the Wealth Tax liability of the assessee, the aggregate value of debt owned by the assessee in respect of the asset owned by the assessee have to be reduced from the aggregate value of assets belonging to the assessee. The ld. Commissioner (Appeals) in para-10 of his order has noted that the assessee has received advances against land amounting to ₹ 909,17,62,728 /-. Further in para-15 of his order, the ld. Commissioner (Appeals) has noted that the amount shown as liability in the balance sheet as advance against the land of ₹ 926,13,44,951/-. The learned AR further submits that assessee explained before ld. Commissioner (Appeals) that the amount of liability shown as advance against land is to be reduced from the value as debt owed. The contention of assessee was accepted by ld. Commissioner (Appeals) by making a reliance on the decision of Hon ble Calcutta High Court in case of Bajoria Properties [258 ITR 29] and hold that the entire addition is liable to be deleted. Thus, the order passed by ld. Commissioner (Appeals) does not call for any interference. 10. We have con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee. It was further held that assessee is not a dealer in land, who is engaged in the business of buying and selling of land and that land acquired by assessee cannot be considered as inventory. Before the ld. ld. Commissioner (Appeals), the assessee made detailed submission including of the submission made by Assessing Officer. The ld. CIT(A) after considering the submission of assessee observed that the assessee has to develop a Special Township, which will definitely take time in completion. The assessee has started the preliminary work after proper approval of the Government. The sanction letter of State Government dated 09.08.2007 that assessee is required to complete the work of development of Special Township within a period of 15 years, failing which the land shall be returned to the original owner. Therefore, the assessee has 15 year time to develop the Township. The Assessing Officer has not given any finding that the assessee has abundant the work of development. The assessing Officer has actually allowed all expenses incurred by assessee as a business expenses. Therefore, the assessee is pursuing development work. The ld. Commissioner (Appeals) concluded that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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