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Allahabad High Court · body

2004 DIGILAW 2426 (ALL)

Commissioner of Wealth-tax v. Manju Rani

2004-12-03

PRAKASH KRISHNA, R.K.AGRAWAL

body2004
( 1 ) THE Income-tax Appellate Tribunal, New Delhi, has referred the following question of law under Section 27 (1) of the Wealth-tax Act, 1957, hereinafter referred to as "the Act", for opinion to this Court : whether, the Tribunal is right in holding that the rectificatory valuation report drawn under section 35 (1) (aa) of the Wealth-tax Act by the Valuation Officer amounted to a second valuation report and thus was not admissible under law ? ( 2 ) THE present reference relates to the assessment years 1981-82 to 1983-84. Briefly stated the facts giving rise to the present reference are as follows : ( 3 ) THE respondent is assessed for wealth-tax in the status of an individual. The valuation date is december 31, of each year. She owned, inter alia, a half share in Manjushree Cinema and a land at Nunhai, Agra. During the course of the assessment proceedings under the Act, the Wealth-tax officer referred the question of valuation to the Assistant Valuation Officer, who determined the value of the assets in question vide order dated November 16, 1984. Subsequently, vide order dated March 28, 1985, the Assistant Valuation Officer had rectified his earlier report. It may be mentioned here that in the original report the Assistant Valuation Officer had taken the value on the rent capitalisation method whereas subsequently he passed the order of rectification on the basis of the land and building method. The Wealth-tax Officer had taken the value as given by the Assistant Valuation Officer vide order dated March 28, 1985, i. e. , the second report as a result of rectification. Feeling aggrieved the respondent preferred an appeal before the commissioner of Wealth-tax (Appeals), who had allowed the appeal and directed the Inspecting assistant Commissioner (Assessment) to determine the valuation in accordance with section 16a of the Act. In the net result the subsequent report dated March 28, 1985, was not taken into consideration. The order has been upheld by the Tribunal. ( 4 ) WE have heard Sri Shambhoo Chopra, learned standing counsel appearing for the Revenue. ( 5 ) LEARNED counsel for the Revenue submitted that under Section 35 (1) (aa) of the Act, the valuation Officer is authorised to amend any order passed by him under Section 16a of the Act with a view to rectify any mistake apparent from the record. ( 5 ) LEARNED counsel for the Revenue submitted that under Section 35 (1) (aa) of the Act, the valuation Officer is authorised to amend any order passed by him under Section 16a of the Act with a view to rectify any mistake apparent from the record. He submitted that the cinema building ought to have been valued on the basis of the land and building method and, therefore, there was a mistake apparent on the face of the record and the Valuation Officer had rightly rectified his earlier valuation report. The submission is misconceived. The valuation of property according to the land and building method is not the only mode prescribed under the Act and the rules for valuation of any property and there are several other modes of valuation available and if the Valuation Officer is his wisdom has taken the rent capitalisation method for valuing the property it cannot be said that the valuation of the property is not correct. By adopting one of the several methods prescribed and accepted for valuing the property, no mistake apparent on the record crept in. In this view of the matter, merely because the Valuation Officer had a change of mind and on second thoughts he valued the property on the basis of the land and building method, such recourse would not be permissible under Section 35 (1) (aa)1 of the Act. Thus, the subsequent report pursuant to the order dated March 28, 1985, shall not be admissible under law and the Tribunal has not committed any error in upholding the order of the Commissioner of wealth-tax (Appeals ). ( 6 ) CONSEQUENTLY, we answer the question referred to us in the affirmative, i. e. , in favour of the assessee and against the Revenue. However, there shall be no order as to costs. . .