9911796707
TMI Blog1989 (8) TMI 94X X X X Extracts X X X X X X X X Extracts X X X X ..... y late Sir. R. J. Vakil. 2. Late Sir R. J. Vakil settled on trust his movable and immovable properties for the benefit of his son Shri Toos R. Vakil and his son's two daughters, viz. Mehr Toos Vakil ; the present assessee and Tehnas R. Vakil. The father, Shri Toos R.Vakil was given life interest and the daughters were given equal remainderman's interest in the properties settled on trust. At the assessment proceedings for the year under consideration for which the valuation date was 31-3-1979, the assessee claimed exemption u/s 5(1)(iv), 5(1)(xxiii) and u/s 5(1)(xxvi) r.w.s. 5(1A) of the Act in respect of her half share, as remainderman, in the house property, shares and bank deposits respectively. She had valued her remainderman's intere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . observed that there was no reason why assessee's remainderman's interest in the shares and bank deposits should not be considered eligible for exemption to the extent provided u/s. 5(1)(xxiii) and u/s. 5(1)(xxvi). He accordingly accepted the assessee's claim in that behalf and directed the W.T.O. accordingly. 4. Mr. P. K. Sharma, the learned Departmental Representative, has vehemently urged before us that the approach of the learned A.A.C. on the points involved in the present case was not at all justifiable in the facts and circumstances of this case. Mr. Sharma emphasised that the nature of the asset belonging to the assessee in the form of her remainderman's interest in the house property cannot be equated to 'one house or part of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r rights of a person. The expression "assets" as defined in the W.T. Act includes property of every description, both movable and immovable. Since 'property' maybe regarded as a bundle of proprietary interests or rights, anyone of such interests or rights would itself be "property", includible in the connotation of "assets". Since the interest of a remainderman falls within the definition of the term "assets" it was includible in the computation of the "net wealth" of the assessee and has rightly been so included by the I.T.O. 8. In the case of Nawab Sir Mir Osman Ali Khan v. CWT [1986] 162 ITR 888/28 Taxman 641 (SC) to which our attention was invited by the learned Departmental Representative, the Supreme Court, explaining the true purpo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal had the occasion to consider the claim of an assessee for exemption u/s. 5(1)(iv) in respect of the house property wherein the assessee had life interest. The Tribunal negatived department's contention that life interest of an assessee in the house property did not make an immovable property and held that any interest in immovable property is itself an immovable property. Further, the Tribunal relying upon Madras High Court decision in the case of K. Ramachandra Chettiar held that the assessee was entitled to exemption u/s. 5(1)(iv) of the Act in respect of his life interest in the house property. 10. In the case of K. Ramachandra Chettiar, the Madras High Court considered claim of an assessee having life interest in a number of h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interest in the house property. 11. The argument of Mr. Sharma that remainderman's interest in an immovable property is no doubt an asset includible in the computation of his net wealth but such an asset does not meet the requirement of "a house" contemplated by Section 5(1)(iv) of the Act is not acceptable. In appreciating the claim of a remainderman for exemption u/s. 5(1)(iv) it should not be lost sight of that it is the value of his right or interest in such a specie of the property which is contemplated by clause (iv) of Section 5(1) that is sought to be subjected to the levy of wealth-tax. No doubt the actuarial value of his such right is arrived at u/s. 7(1) on the hypothesis of a supposed open market and intending seller and a bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Sharma is over-ruled. For the reasons stated above, we confirm the order of the learned A.A.C. on the point. 12. Now so far as the claim of the assessee for exemption u/s. 5(1)(xxiii) and u/s. 5(1)(xxvi) in respect of her remainderman's interest in the shares and bank deposits respectively is concerned, we agree with the learned A.A.C. that once the claim of the assessee for exemption u/s. 5(1)(iv) in respect of her remainderman's interest in the house property is accepted, there seems to be no good reasons to deny her exemption u/s. 5(1)(xxiii) and u/s. 5(1)(xxvi) as well. On the analogy adopted for approving her entitlement to exemption u/s. 5(1)(iv) in respect of her remainderman's interest in the house property and which has been ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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