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TMI Blog1985 (8) TMI 94X X X X Extracts X X X X X X X X Extracts X X X X ..... d one-third share of the assessee in the firm of Nagarmal & Co. taken at Rs. 26,812. 3. The Commissioner being of the opinion that the order passed by the WTO was erroneous insofar as it was prejudicial to the interests of the revenue, initiated proceedings under section 25(2) of the Wealth-tax Act, 1957 ('the Act'). In the notice issued on 10-2-1983 under the above section, to the assessee, the Commissioner pointed out two errors on the part of the WTO. The first error pointed out by him, related to the value of the assessee's share in the firm of Nagarmal & Co. The Commissioner stated that there was appreciation in the value of the property belonging to the above firm and if that appreciation was taken into account, then the assessee's s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd to the second error regarding the under-charge of additional wealth-tax, it was pointed out to the Commissioner that Rs. 11,70,517 included the value of two properties belonging to the firms of New Cawnpore Flour Mills and Nagarmal & Co., which were the assessee's business assets. It was argued before the Commissioner that the additional wealth-tax was chargeable on the assets other than the business premises. In this connection, attention of the Commissioner was also invited to the definition of 'business premises' appearing in rule 1 of Paragraph B of Part I of Schedule I of the Act. This contention was rejected by the Commissioner in view of rule 3 of Part I of Schedule I thereof. We will have occasion to deal with this rule a little ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sis as would appear from para 5 of his order. 7. On behalf of the department, it was submitted that if there was any lacuna in the operative part of the order of the Commissioner it was open to the Tribunal to either call for a remand report or direct him to plug the lacuna and pass a proper order. The learned departmental representative was, however, unable to place before us any copy of the report of the Valuation Officer with regard to the valuation of the property belonging to Nagarmal & Co. 8. We have carefully considered the submissions placed before us. In the absence of any report of any Valuation Officer, it cannot be said that there was any appreciation in the value of the property belonging to the above firm. There is also no m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laim. 12. We have carefully considered the submissions placed before us. In our opinion, there is considerable force in the submissions placed on behalf of the assessee. We will quote below the relevant portions of Part I of the Schedule to the Act : "(2) In addition, in the case of every individual and Hindu undivided family, where the net wealth of the individual or Hindu undivided family includes the value of any asset, being building or land (other than business premises) or any right in such building or land, situated in an urban area (such asset being hereafter in this Part referred to as urban asset). Paragraph B Rule 1. In this Part--- (i) 'business premises' means any building or land or part of such building or land, or any r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e firm or, as the case may be, the association, computed as if such firm or association, were individual." Our reading of the above provisions goes to show that the Legislature had granted exemption to business premises from the additional wealth-tax by excluding them from the definition of 'urban assets'. Rule 1 then defined 'business premises'. Rule 3 then laid down the procedure for valuing the interest of a partner in a firm or a member of an AOP in urban assets. Rule 3 refers to 'urban assets'. 'Urban assets' have already been taken to be the assets other than business premises. Rule 3, therefore, cannot refer to business premises. Even otherwise, there appears to be no logic in withdrawing exemption from additional wealth-tax on busi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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