, Û `',
IN THE INCOME TAX APPELLATE TRIBUNAL
MUMBAI BENCHES "G", MUMBAI
^ .. , Ú¢ , ^ . . ã , ¢
Before Shri H L Karwa, President & Shri N K Billaiya, Accountant Member
Þ ./ WTA Nos.57, 58, 59, 60 & 61/Mum/2011
[ [ / Asst.Yrs :1996-97,1997-98, 1998-99, 1999-2000 & 2000-01
Forbes & Company Ltd ACWT 1(1),
(Formerly Knowns as Forbes Mumbai
Gokak Ltd.) Vs.
Forbes Bldg., Ground Floor,
Charnjit Rai Marg, Fort,
Mumbai- 400 001
PAN AAACF1765A
( /Appellant) (×/Respondent)
Appellant By : S/Shri R Murlidhar V Shetty & M D Thakore
Respondent By : Smt. Parminder
/ /
Date of Hearing :19.08.2014. Date of Pronouncement : 19.08.2014
/ O R D E R
Per Bench:
These five appeals by the assessee are preferred against the orders of the
CWT(A)-1, Mumbai, pertaining to A.Ys. 1996-97, 1997-98, 1998-99, 1999-2000 &
2000-01. All these appeals have common grounds of appeal, therefore, they were
heard together and are being disposed of by this common order for the sake of
convenience and brevity.
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WTA Nos.57-61/Mum/2011
2. We are taking the grounds of appeal in WTA 57/Mum/2011. The grievances
of the assessee read as under:
"Validity of Valuation Report by the Valuation Officer (VO)
1. The learned Commissioner of Wealth-tax, (Appeals)-1
{CWT(A)} erred in confirming the action of the Assessing
Officer (AO) in holding that sufficient opportunity was given by
the VO to the appellant with respect to making submissions and
filing objections in connection with the valuation of its vacant
land situated at Raichur.
He further erred in holding that the appellant did not raise any
objection to the report of the VO.
2. The CWT(A) in the facts and circumstances of the case and in
law erred in confirming the order of the AO by holding that the
VO has not violated the principles of natural justice by providing
sufficient opportunity to the appellant.
3. The appellant prays the order passed by the AO be held as
invalid and ought to be quashed.
Enhancement of Assessment in relation to valuation of land
4. The learned CWT(A) in the facts and circumstances of the case
and in law erred in confirming the action of the AO in
determining the taxable wealth of the appellant at
Rs.4,77,56,800. He also erred in confirming the valuation of
the impugned land at Raichur at Rs.2,35,37,000 as determined
by the VO as against Rs.47,00,000 as computed by the
appellant.
5. The learned CWT(A) further erred in not appreciating the fact
that the appellant cannot be worse off in a matter restored by
the Hon'ble Appellate Tribunal to the files of the AO vis-à-vis
the valuation made vide assessment order dated 24 December,
2003 issued under section 16(3) rws 17 of the Act by the AO.
6. The appellant prays that the order issued by the AO giving
effect to the order of the VO is not justified and ought to be
quashed.
7. In the facts and in the circumstances of the case, the CWT(A)
has erred in conforming the action of the AO in considering the
area of the Raichur land at 3,76,853 sq. ft (i.e. 5,22,720 sq. ft.
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WTA Nos.57-61/Mum/2011
less 1,45,867 sq. ft.) as against 1,77,501 sq. ft as submitted by
the appellant.
8. The appellant prays that the AO be directed to consider the
appropriate area left with the appellant for Wealth tax purposes
and it ought to be restricted to 1,77,501 sq. ft. as submitted by
your appellant as against 3,76,853 sq. ft adopted by the VO/AO
9. Alternatively and without prejudice to the above grounds of
appeal, the appellant prays that the impugned land ought to be
valued @47 per sq. ft. (being the rate at which part of the land
was sold to LIC in FY 1995-06)
3. Briefly stated the facts of the case are that the original return of wealth was
reassessed by reopening. The reasons for re-opening of the assessment were that
the assessee owned land having area 5,22,720 sq. ft. out of which area of 1,45,687
sq. ft. was sold to Life Insurance Corporation of India @Rs.47/- per sq. ft. on
15.12.1995. Taking a leaf out of this sale transaction the assessment was reopened
and the assessment order u/s. 16(3) r.w.s. 17 of the WT Act dated 24.12.2003 was
passed. The reassessment was completed by the AO adopting the value of the land
@ Rs.47/- per sq. ft. and, accordingly, additions were made to the returned wealth
of the assessee. The assessee carried the matter before the CWT(A), which was
confirmed by him. The assessee then preferred appeal before the Tribunal. The
Tribunal restored the matter to the file of the AO with a direction to make a
reference to the Valuation Officer u/s. 16A of the WT Act. During the course of set
aside proceedings the AO referred the matter to the DVO. A preliminary valuation
report was received and on the basis of the preliminary valuation report the
assessment was completed. The assessee agitated this matter before the CWT(A)
but without any success. Hence, the assessee is in appeal before us.
4. We have heard the rival submissions and carefully perused the orders of the
authorities below. It is a fact that the original assessment was re-opened on the
strength of the sale transaction done by the assessee with Life Insurance
Corporation of India. The reassessed wealth was computed by taking the sale rate
i.e. @ Rs.47/- per sq. ft. with Life Insurance Corporation of India. It is also an
admitted fact that the matter travelled up to the Tribunal and was set aside with the
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WTA Nos.57-61/Mum/2011
directions to refer the matter to the valuation officer. However, the present
assessment has been done on the basis of the preliminary valuation report which
has substantially enhanced the reassessed wealth, which was computed vide order
dated 24.12.2003. Now the issue before us is can the assessee be put into worse
situation than what it was at the time of original assessment. Since after giving
effect to the order of the Tribunal there cannot be any scope of enhancement of
assessment, this proposition of law has been laid down by Hon'ble Supreme Court in
the case of Hukumchand Mills Ltd. vs. CIT 62 ITR 232(SC) and subsequently
reiterated by the Hon'ble Supreme Court in the case of Mcorp Global (P) Ltd. 309
ITR 434 (SC). The fact of the matter is that the ratio laid down by the Hon'ble
Supreme Court relates to the Income Tax Act whereas we are dealing with Wealth
Tax assessment. Unlike the provisions of section 254(1) of the IT Act 1961, section
24(5) of the WT Act empowers the Tribunal to pass such order therein as it thinks
fit and any such orders may include an order enhancing assessment or penalty.
However, this can be done only when a cross appeal or cross-objection has been
filed by the department against the order of the first appellate authority. Unless this
is done, the appellate Tribunal has no jurisdiction or power to enhance the
assessment. This proposition of law is supported by the decision of Hon'ble
Supreme Court in the case of State of Kerala vs. Vijaya Stores in Civil Appeal No.
477 of 1976. In the case of Kannan Devan Hills Produce Co. Ltd. vs. CWT 67 ITR
823, the Hon'ble Kolkata High Court held that the Tribunal was justified in rejecting
the application because there was neither a cross appeal nor a cross objection in
that regard.
5. Coming back to the facts of the case in the light of the aforesaid judicial
decisions, the undeniable fact is that against the reassessment order the assessee
preferred an appeal and the department has accepted the order of the CWT(A).
Therefore, in our considered opinion, subsequent assessment order in pursuance to
the direction of the Tribunal has resulted into an enhancement of wealth. However,
in the interest of justice, to put an end to the prolonged litigation, we direct the
WTO to assess the wealth @ Rs.47/- per sq. ft. as was done in the reassessment
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WTA Nos.57-61/Mum/2011
proceedings vide order dated 24.12.2003. The alternative plea of the assessee
raised vide ground no.9 is accepted.
Since we have accepted the alternative plea, we do not find it necessary to
decide other grievances of the assessee. We order accordingly.
Order pronounced in the open court on this 19th day of August, 2014.
Sd/- Sd/-
(H L Karwa) (N K Billaiya)
Ú¢ /PRESIDENT / ACCOUNTANT MEMBER
Mumbai; Dated :19th August, 2014.
SA
/Copy of the Order forwarded to :
1. /The Appellant.
2. × / The Respondent.
3. () / The CWT(A), Mumbai.
4. / CWT
5. , , / DR, `G' Bench, ITAT,
Mumbai
/ BY ORDER,
× //True Copy//
(Dy./Asstt. Registrar)
, / ITAT, Mumbai
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