Law: Wealth Tax Rules, 1963

Section: 8(1)

Wealth Tax Rules, 1963--- ----R.8(1)(3)---Valuation of assets---How to be estimated---Conditions--­Valuation of the property was to be made on the basis of the price which it would fetch if sold on the valuation date---Wealth Tax Officer will estimate the value of the property on the basis of its price and then check if the estimated price does or does not exceed ten times of the gross annual rental value of the property and would adopt that value which is less of the two values. Rule 8(1) of the Wealth Tax Rules, 1963, provides that subject to the provisions of sub-rule (3) the value of any asset (other than cash) shall, for the purposes of assessment to wealth tax, be estimated to be the price, which in the opinion of the Wealth Tax Officer, it would fetch if sold in the open market on the valuation date. Sub-rule (3) of Rule 8(1) provides that the value of lands and buildings shall be estimated with due regard to the nature and size of the properties, the amenities available and the price prevailing for similar property in the same locality or in the neigh boarhound of the said property. Thus the stating point to estimate the value of any asset is the price which it would fetch if sold in the open market on the valuation date. The proviso to sub-rule (3) of Rule 8, however, provides that the Wealth Tax Officer shall not, except with the prior approval of the Central Board of Revenue, determine the value of any property at a sum higher than ten times of gross annual rental value of such property. Sub-rule (3) of Rule 8 does not provide for estimating the value of any asset but it only provides an embargo that the estimated price of any land or property shall not exceed ten times the gross annual rental value of any property. The Wealth Tax Officer will estimate the value of the property on the basis of its price and then check if the estimated price does or does not exceed ten times of the gross rental value of the property and would adopt that value which is less of the two values. ORDER CH. IRSHAD AHMAD (JUDICIAL MEMBER).---Through this appeal the Wealth Tax Officer, Circle-2, Faisalabad has objected to the order, dated 5-4-1989 of Commissioner of Wealth…

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