Law:

Section:

Section 2(ea) of the Wealth-Tax Act, 1957 - Assets - Assessment year 2000-01 - Whether building in process of construction cannot be understood as a building which has been constructed, in terms of meaning given to 'urban land' as defined under section 2(ea)(b) - Held, yes - Whether 'constructed' would mean 'fully constructed' as understood in common parlance - Held, yes - Whether since wordings 'urban land' would mean a land on which complete building stands, such land alone would qualify for exemption - Held, yes FACTS The assessee owned certain land which was given to a company for the construction of residential flats thereon. The Assessing Officer holding that the assessee, being the owner of the vacant land, was liable to wealth-tax in terms of the provisions governing such assessment, brought the same to tax by treating the said land as urban land. On appeal, the Commissioner (Appeals), however, set aside the impugned order. On revenue's appeal, the Tribunal noticing the view expressed by it in an earlier case, dismissed revenue's appeal. In appeal, the assessee's case was that since the building is being constructed, the same was exempt for the purpose of wealth-tax in terms of the meaning to be given to an urban land. HELD A perusal of the definition of 'urban land' under section 2(ea)(b ) would show that certain lands are not includible for the purpose of 'urban land'. In the instant case, the lands were occupied by a building which had been constructed with the approval of the appropriate authority. The approval by the appropriate authority was not disputed. What was argued was that since the building was being constructed, the same was exempt for the purpose of wealth-tax in terms of the meaning to be given to urban land. A careful reading of the said definition would show that what is excluded is the land occupied by any building which has been constructed. Admittedly, in the instant case, the building was not fully constructed. It was in the process of construction. A building in the process of construction cannot be understood as a building which has been constructed as sought to be argued. The Courts have to interpret any definition in a…

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