Law: Wealth Tax Act, (XV of 1963)

Section: 2(1)(5)(ii),16(3)

Wealth Tax Act (XV of 1963)----Ss. 2(1)(5)(ii) & 16(3)---Assets---Property held for purpose of business of construction and sale or letting out---Commercial open plots---Shares in such plots were assessed in the hands of individual--­First Appellate Authority deleted addition and directed that said plots be appraised for wealth tax purposes collectively in the hands of Association of Persons---Validity---Plots and land were as bare as they were in the year of purchase i.e. 1993---Assessing Officer could not close his eyes to this hard ground reality and even if co-owners did eventually construct a commercial building on plots they would in all likelihood be carrying on their own individual business therein---Even if, any vacant space was sold or let out by the individual co-owners, that too was likely to be in their individual capacity---On the valuation date, the individual share holdings of the co-owners, had to be assessed in their individual hands for purposes of levy of wealth tax and could not be considered for assessment purposes in, the hands of an imaginary Association of Persons that had no actual/real existence---Property held by the assessee through her minor son was also liable to be assessed in her personal hands and was not the property of any imaginary Association of Persons---Order of First Appellate Authority was vacated by the Appellate Tribunal and Assessing Officer would finalize assessments in case of co-owners as their having shareholding in properties. PLD 1975 SC 331; PLD 1974 SC 106; PLD 1965 SC 269; PLD 1973 SC 236; 1996 PTD (Trib.) 114; 1996 S6MR 470 and 1999 PTD 3817 ref. (b) Wealth Tax Rules, 1963--- ----R. 8(3), first proviso & Explanation---Valuation of land and building---Rule 8(3), first proviso and Explanation of Wealth Tax Rules, 1963 shall apply strictly for valuation of immovable properties held by the co-owners---No question would arise of separate valuation of land and superstructure and Central Board of. Revenue's Circular/Instructions issued in this regard were to be ignored. ORDER MUHAMMAD MUNIR QURESHI (ACCOUNTANT MEMBER).---These appeals by Revenue arise out of order passed by the CIT/WT (A), Zone-I, Lahore,…

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