Law:

Section:

Section 2(e) of the Wealth-tax Act, 1957 - Assets - Assessment years 1957-58 to 1963-64 - Assessee inherited plots of agricultural land in 1952 and carried on agricultural activities on it - In 1959, scheme under Town Planning Act, 1954 was applied to this area - Assessee plotted out aforesaid land and sold it on yardage basis - Admittedly, in area roundabout there was no building activity - Land was not approached by any road to any residential locality or other societies - Purchasers of land had not made any attempt to carry on any non-agricultural activity on said land - Whether land could possess its agricultural character even if it was covered by draft town planning scheme - Held, yes - Whether mere fact that lands were plotted out and sold would not necessarily show that its intrinsic character was changed - Held, yes - Whether since evidence was not potent enough to displace presumption about agricultural character of land in question, value of said land could not be included in net wealth of assessee - Held, yes FACTS The respondent assessee inherited two plots of land on death of his father in 1952. Right from the year 1952, when the assessee inherited these plots, up to the year 1963-64, both these plots of land were actually put by the assessee in cultivation. Previously, there were tenants on both lands but these tenant surrendered the possession of the land to the assessee and, therefore, the assessee carried on the cultivation of these lands personally. In August 1959, a draft scheme of Town Planning was applied to this area and the scheme was finalized in 1966. In the months of November and December of the year 1959, the respondent-assessee plotted out both these pieces of land and then sold those plots on yardage basis during accounting years relevant to assessment years 1959-60 to 1963-64. For the assessment years1957-58 to 1963-64, the assessee claimed that the plots of land covered by the above mentioned survey numbers were agricultural lands on all the valuation dates and, therefore, they were not liable to the payment of wealth-tax. This contention of the assessee was rejected by the WTO. On appeal, the AAC found that the lands were…

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