Law:

Section:

SCHEDULE TO THE WEALTH-TAX ACT, 1957 [AS IT STOOD PRIOR TO 1976] - ADDITIONAL WEALTH-TAX ON URBAN ASSETS - WHETHER AGRICULTURAL LAND SITUATED WITHIN AN URBAN AREA ON WHICH ASSESSEE CARRIED ON AGRICULTURAL OPERATIONS COULD BE TREATED AS BEING USED FOR BUSINESS WITHIN THE MEANING OF RULE 1(i) OF PARA B OF SCHEDULE AND HENCE WOULD BE EXEMPT FROM LEVY OF ADDITIONAL TAX - HELD, ON FACTS, YES Facts While making the wealth-tax assessment for the assessment year 1974-75, the WTO assessed the value of the agricultural land belonging to the assessee on which she carried on agricultural operations. As the agricultural land was situated within the urban area, the WTO treated the same as an urban asset within the meaning of clause (2) of Para A, Part 1 of the Schedule and levied additional wealth-tax. The Tribunal, however, held that the agricultural land owned by the assessee, which was an urban asset, was covered by the exemption envisaged by Paragraph A(2) of the Schedule, Part I, inasmuch as such land was used by the assessee throughout for the purpose of profession within the meaning of rule 1 of Paragraph B of the Schedule. On reference : Held Rule 1(i) of Para B of the Schedule clearly indicates that any building or land owned by the assessee and used during the previous year for the purpose of business or profession has to be excluded for the purposes of levying of additional wealth-tax on urban assets. The expression 'business', though not defined, in a broad sense, is taken to mean everything that occupies the time, attention and labour of men for the purposes of livelihood or profit. Section 2(36) of the Income-tax Act, 1961, defines the term 'profession' as including vocation. 'Vocation' and 'occupation' are synonymous and there is no difference between the two. In so far as the agricultural operations involve carrying on systematic entrepreneurial activity with the help of capital and labour with a view to earn profits and the element of risk being not absent from such operations, the agricultural operations will fall within the category of business. Even if these operations were held as not amounting to business, they would amount to profession within the…

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