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2008] 304 ITR 409 [2008] 168 TAXMAN 303 (BOM.) HIGH COURT OF BOMBAY Commissioner of Wealth-tax, Mumbai* v. Akshya Textiles Trading & Agencies (P.) Ltd. F.I. REBELLO AND J.P. DEVADHAR, JJ. WT APPEAL NO. 313 OF 2003 OCTOBER 24, 2007 Section 2(m) , read with sections 3 and 7, and rule 3 of Part B of Schedule III of the Wealth-tax Act, 1957 - Net wealth - Assets belonging to assessee - Assessment year 1998-99 - Whether where assessee had given a premises on licence and licensee had sub-licensed same to other person for a higher consideration, for purpose of Wealth Tax, only rent received or receivable by assessee from licensee would be material and rent/licence fee paid by ultimate sub-lessee to lessee or licensor would be immaterial - Held, yes FACTS The assessee had given a premises on licence to the licensee for a consideration. The licensee, thereafter, had sub-licensed the premises to 'R' for a higher consideration. The Assessing Officer held that the transaction between the licensee and licensor was a colourable device and, therefore, the amount receivable by the assessee was the amount which 'R' had paid to the licensee. On appeal, the Commissioner (Appeals) held that the Assessing Officer was not justified in adopting the rent paid by the ultimate user, i.e., 'R' as ALV and also the deposit paid by 'R' could not be taken into account for the purpose of working out the annual rent and gross maintainable rent. He, accordingly, allowed the appeal. On revenue's appeal, the Tribunal decided the issue in favour of the assessee. On appeal : HELD The issue of annual letting value insofar as proceeding under the Income-tax Act, on similar facts, where the assessee had given premises on licence by accepting consideration and the licensee had given the premises on sub-licence to 'R' for higher consideration, had been considered in the case of CIT v. Akshay Textiles Trading Agencies (P.) Ltd. [2008] 167 Taxman 324 (Bom.), wherein it was held that what has to be considered is the annual value received by the owner, irrespective of whether the licensee or lessee, on subletting the premises, had received higher consideration or rent. Considering that under the…

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