Law: Wealth Tax Act, 1957

Section: 25,16A(5),7(1), ScheduleIII

Law: Wealth Tax Rules, 1957

Section: 1BB

Wealth tax--- ----- Valuation of property---Law applicable---Provisions contained in Sched. III are procedural in nature---Provisions as amended w.e.f. 1-4-1989, applicable to pending proceedings---Indian Wealth Tax Act, 1957, Sched. III. The Direct Tax Laws (Amendment) Act, 1989, amended the Wealth Tax Act with effect from April 1, 1989. Under the amendment, Schedule III was introduced by the Act, which provides for the rules for determining the value of assets. Part B of the said rules provides for the valuation of immovable property. Under rule 3, the value of any immovable property being a building or land pertaining thereto, shall subject to the provisions of rules 4, 5, 6, 7 and 8 for the purpose of section 7(1) be the amount arrived at by multiplying the net maintainable rent by the figure 12.5. Rule 5 provides for the computation of the gross maintainable rent. The provisions relating to valuation of the property contained in Schedule III are procedural in nature and procedural law is applicable to pending cases also. The provisions are in the character of rules of evidence and, therefore, the market value has to be determined in accordance with the provisions which are in operation at the time when the assessment is made. Held, (i) that on the material on record it was very clear that before passing the impugned orders, the petitioners were given proper opportunities to put forward their case, but they did not avail of the same properly. Therefore, the impugned orders were not violative of the principles of natural justice. (ii) that, however, the impugned orders were opposed to the specific provisions of the Wealth Tax Act being rule 3 under Part B of Schedule III and were liable to be quashed. CWT v. Sharvan Kumar Swarup & Sons (1994) 210 ITR 886 (SC) and CWT v. Sunder Lal Gupta (1997) 225 ITR 729 (Raj.) applied. JUDGMENT Y. VENKATACHALAM, J.---Since in both these cases, the subject-matter involved and the respondents are common, both these writ petitions are disposed of by this common order with the consent of the concerned parties. These writ petitions have been filed by the petitioners herein by invoking Article 226 of the Constitution of…

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