Income Tax Appellate Tribunal - Gauhati
Ka Krom Rapsang vs Wealth-Tax Officer on 29 March, 1990
Equivalent citations: [1990]34ITD316(GAU)
ORDER
Egbert Singh, Accountant Member
1. The appeals are by the assessee which are directed against the consolidated orders of the CWT(A) by which he has sustained the penalty imposed under Section 18(1)(c) of the W.T. Act for the above years and under Section 1.8(1) (a) for the assessment years 1983-84 and 1984-85.
2. We shall first take up the appeal for the assessment year 1979-80. The WTO noted that the assessee in her wealth-tax return did not disclose certain house properties at Shillong and certain properties at Cantonment area. The assessee disclosed the ownership of land at Cantonment area but the value was shown at Nil. According to the assessee, the land in the Cantonment area was a leasehold land under the cantonment authority, i.e., Defence Department and that there was a stipulation by the defence authority that they may require the land at any time and the assessee has to release the same without compensation. One property is located at Jaiaw which the WTO found that the assessee had not disclosed the same on the ground that she was not the owner of the property. Another property is a godown at Barabazar was also not shown on the ground that the land belonged to Syiem of Mylliem and for which she is to pay rent and, therefore, the assessee is not the owner of the land and the value was, accordingly, not shown in the return. The WTO found that on the above Barabazar land taken on rent, the assessee has raised an Assam type godown of 150 sq.ft. and, therefore, he held that the value of this structure should have been disclosed by the assessee.
3. The WTO also found that the land at Cantonment was purchased by the assessee from one Shrimati Uma Rani Chakraborty for Rs. 80,000 on 21-9-78 and, therefore, the contention of the assessee that the value would be Nil was not acceptable.
4. In respect of the Jaiaw property the WTO noted that it was exclusively enjoyed by the assessee who had made extension to the building, the assessee claimed that the Jaiaw property belonged to the clan and not to the assessee. The WTO pointed out that the assessee has not shown that any other member of her tribal clan was deriving any benefit out of the property. He, therefore, inferred that the value of this property had also to be assessed in the hands of the assessee. From the penalty order, it is seen that the value of these properties was assessed at Rs. 3,90,000 for the year 1979-80. According to the WTO, the assessee had concealed the particulars of assets and furnished inaccurate particulars thereof. He, therefore, initiated proceedings under Section 18(1)(c). Similar contentions were made in course of proceedings which the ITO did not accept. He, therefore, held that the assessee had concealed the particulars of assets as well as furnished inaccurate particulars in respect of those assets mentioned. He, therefore, imposed a penalty of Rs. 4,700.
5. From the assessment year 1980-81 up to the assessment year 1984-85, the WTO in his penalty orders discussed similar facts and submissions and came to the conclusion that the assessee had concealed the assets for which penalty provisions were attracted. On identical reasons given by him, the WTO imposed similar penalties on the basis of his working in those different years.
6. The assessee took up the matter before the CWT(A) reiterating the same contentions as noted by the WTO in the penalty orders. According to the CWT(A), the assessee had constructed Assam type godown of 150 sq.ft. which value had not been shown in the return and, therefore, the assessee had concealed this particular property for the years under consideration, particularly when for the assessment year 1985-86, the assessee had disclosed the value of the property in her return in that later year. Similarly, in respect of the Cantonment land, the CWT(A) was of the view that he could not agree with the contention of the assessee as the value of the leasehold land should be included in the wealth and could not be at 'Nil' as contended by the assessee.
7. In respect of the Jaiaw property, the assessee reiterated the same plea that she was not the owner of the property relying on Sir Keith Cantlie's notes on Khasi Law, 1974 Edition, wherein it has been laid down that such property was owned by her claim and was not her individual property. The CWT(A), however, found that the assessee had shown this property in her return for the assessment years 1985-86 and 1986-87 and, therefore, it was clear that this property belonged to her and no member of clan is co-owner with her. The CWT(A), therefore, concluded that the WTO was justified in imposing the penalty under Section 18(1)(c) for all the years. No interference is made by the CWT(A). Hence, these appeals by the assessee.
8. We have heard both the sides at length and we have gone through the orders of the authorities below for our consideration. The assessee's learned counsel reiterates and placed emphasis on various points as made out before the authorities below in respect of the various items included in the assessment. On the query made by the Bench, it is slated that the assessee had accepted the assessment orders possibly in order to buy peace. Be that as it may, the submissions of the assessee are that there was no contumacious conduct or no mala fide intention on the part of the assessee to conceal any wealth or to furnish inaccurate particulars thereof. In short, it is urged that on the facts of the case, the penalty for all the above years was not justified, specially when the assessee has co-operated all throughout to the extent possible and had in fact accepted the order of the assessing officer though not factually acceptable to the assessee.
9. The learned Departmental Representative supports the order of the CWT(A) for all the years. It is urged that the WTO has brought out materials and relevant facts on record to show that the assessee being the owner of those properties did conceal those items from the wealth-tax returns and, therefore, the provisions of Section 18(1)(c) have been properly applied by the WTO and correctly sustained by the CWT(A). It is also urged that the WTO has imposed the minimum penally for all the years and there is no room for any relief.
10. As has been mentioned briefly above, apparently the assessee had accepted the assessments made by the assessing officer as no appeals apparently are pending at the appellate stage. Findings in the assessment orders are good evidences but they are not conclusive nor final. It may be mentioned here that the orders impugned before us is the consolidated order of the CWT(A) in which the caption has been given as penalty imposed under Section 18(1)(c). But it is seen that the W.T.A. Nos. 45 (Gau.) of 1989 and 47 (Gau.) of 1989 relate to the imposition of penalty under Section 18(1)(a) of the Act.
11. For the assessment year 1983-84 being WTA No. 45 (Gau.) of 1989, there was delay in filing the return. According to the assessee, her business was with different Government departments and there was delay in filing the return due to the delay by the Government departments to finalise the bills etc. The WTO observed that the bills submitted to the Government were to be finalised by the Government and, therefore, the amount of each and every bill should have been known to the assessee and the payments in respect of these bills made by the Government during the relevant year and up to the date of valuation should also be known to the assessee and that the remaining bills could be shown as outstanding bills. The WTO, therefore, held that the delay as shown by the assessee has no merit. He was, therefore satisfied that the assessee had delayed the filing of the return without reasonable cause. He, therefore, imposed penalty of Rs. 6,740 under Section 18(1)(a) of the WT Act, 1957, for the assessment year 1983-84.
12. For the assessment year 1984-85 also, similar submissions were made by the assessee which were rejected by the WTO. He, therefore, imposed a penalty of Rs. 12,289 for identical reasons as given in the penalty order. Hence, these appeals by the assessee.
13. On appeal before the CWT(A), same arguments were reiterated and the CWT(A) was of the opinion that the assessee was not prevented by reasonable cause in not filing the return in time. The CWT(A) placed reliance on the decision of CIT v. Shanta Electrical Industries [1986] 160 ITR 774 (Delhi). He, therefore, confirmed the orders of the WTO for both the years.
14. As mentioned earlier, it appears that there is no pending appeal in respect of the quantum. Here, also, we have heard both the sides and we have gone through the orders of the authorities below for our consideration. It is seen that as far the penalty under Section 18(1)(a) is concerned, the CWT(A) relied on the decision of the Hon'ble Delhi High Court in the case of Shanta Electrical Industries (supra). Amongst other things, it was held that onus of proof of reasonable cause was on the assessee. But the Hon'ble Gujarat High Court (FB) in the case of Addl. CIT v. I. M. Patel & Co. [1977] 107 ITR 214 has taken contrary view to the effect that the burden to show that there was reasonable cause for late filing of the return lies with the department and that burden has to be initially discharged by the revenue and once that burden, which may be slight, has been discharged by the revenue, then the burden shifts to the assessee. Thus, there are two possible views on this judicial interpretation relating to the burden to be discharged before the penalty is imposed. Keeping in mind the settled principle of law on this point, the view that favours the assessee should have to be adopted. Now, we have to see whether the department has discharged this initial burden contemplated by the section. We find that apart from the rejection of the explanation of the assessee as unacceptable by the WTO, there was no other fact or material brought out by the WTO to discharge the burden in establishing that there was no reasonable cause for the assessee in filing the return late in the present case. This is a finding of fact. That apart in a similar situation, in the case of Smt. Indu Bania v. CWT[1980] 125 ITR 436 (Gauhati). On the facts of that case, it was held by the Hon'ble Gauhati High Court that for failure to furnish return, the authority concerned must establish mens rea before imposing penalty under the WT Act. Of course, the view of the Hon'ble High Court was dissented by the Hon'ble Punjab and Haryana High Court (FB) in the case of CIT v. Patram Dass Raja Ram Ben [1981J132 ITR 671, But we are bound by the decision of our Hon'ble High Court at Gauhati. In the present case before us, we find no mens rea on the part of the assessee for late filing of the return. On merits, the contention of the assessee was that it could not obtain details from the department or the Government with whom the bills were pending or yet to be finalised and that was why there was inordinate delay in filing of the wealth-tax returns. The WTO observed that such returns could be filed on the basis of the outstanding bills receivable etc. But one has to bear in mind that the return is purported and supposed to be filed correctly with correct details and correct particulars or else the provisions concerning penalty proceedings for furnishing inaccurate particulars or concealment of any asset might be attracted. Therefore, the assessee has to be careful in filing return and before giving declaration in the prescribed form in the return itself to the effect that correct particulars have been furnished. Keeping in view such mandatory obligations imposed on an assessee, such assessee has to be very careful in filling up the return to avoid penal consequences. In doing so, it could not be said that the assessee has deliberately delayed in filing of return without reasonable cause. In our opinion, the cause shown by the assessee in the present case for the years under consideration was reasonable. In the circumstances of the case, penalty was not warranted. Thus, from whatever angle we may look at the problem, we are satisfied that the penalty for both the years under Section 18(1)(a) was not warranted. The orders of the authorities below on the point are cancelled.
15. Coming now to the appeals relating to the penalty orders under Section 18(1)(c) for the years under consideration. As mentioned above, we are to say that the WTO has passed a detailed order for the assessment year 1979-80 and identical orders were passed for other years. After hearing both the sides and after we have gone through the findings of the authorities below in their respective orders, it is seen that the first item of the property involved was regarding the property at Jaiaw, which was stated to have not been disclosed in the return filed by the assessee as according to her the same did not belong to the assessee but to her clan. In other words, the assessee had only a right of residence in the said property. Of course such occupants may maintain or renovate the property being used as residence. The claim of this assessee was not accepted as the CWT(A) found that no member of the clan has been shown to be the co-owner with the assessee in respect of this property. Under the Khasi customary law, a member of the clan does not have any exclusive right of ownership over any asset or property of the clan. Similar situation has cropped up in the case of Mrs. C. Pyngrope in which the Appellate Tribunal has dealt, with the various aspects of the matter relating to this type of disputes. Of course, in the case of Mrs. C. Pyngrope, the claim was that Mrs. Pyngrope was also 'khadduh', i.e., the youngest female member of the particular clan and in that capacity held the property in custody on behalf of the clan itself. As mentioned earlier, in the present case, the assessee claimed that the property belonged to the clan but the CWT(A) found that the assessee has not shown who were the other members of the clan, who are co-owners with the assessee. But as indicated earlier, in respect of clan property, there is no question of ownership by any individual member of that clan as no particular property can be treated as individual property of that individual member. This was the stand taken by the assessee relying on the Notes on Khasi Laws by Sir Keith Cantlie, 1974 Edition, as mentioned earlier. The Appellate Tribunal in the case of Mrs. C. Pyngrope being WTA. Nos. 47 to 55 (Gau.) of 1972-73, dated 28-9-1972 had to deal with a similar situation and held that the properties of the clan were not the individual properties of that assessee and, therefore, it cannot be assessed in the hands of the assessee. But as indicated earlier elsewhere, it has not been pointed out before us at the time of hearing that the quantum assessment is still pending at any appellate stage. In other words, the issue has become final. True, findings in the assessment would constitute good evidence but not conclusive by themselves as far as penalty matters are concerned, for which other materials will have to be taken into consideration, vis-a-vis, the claim and rival contentions of both the parties. We have to see whether there was on the facts of the case concealment of this property by the assessee for the purpose of her wealth-tax assessment. In view of what we have discussed above, it is quite clear that if the property of the clan did not constitute the property of the individual members, then such property cannot be said to be belonged to such individual members. In this connection, it would be helpful to refer to a decision of the Hon'ble Supreme Court in the case of CWT v. Bishwanath Chatterjee [1976] 103 ITR 536, in which amongst other things and on the facts of that case, it was held that liability to wealth-tax arises out of ownership of the asset and not otherwise, as mere possession or joint possession without right to or ownership of property would not be sufficient as such property were not 'belonging' to the assessee.
16. In a slightly different context in the case of R.B. Jodha Mal Kuthiala v. CIT [1971] 82 ITR 570 the Hon'ble Supreme Court dealing with Section 9 of the Indian Income-tax Act, 1922, on the facts and in the context of that case held that the ownership must be the person who can exercise the rights of the owner, not on behalf of the owner but in his own right. That decision was for the purpose of assessing income from the property. It was also held that residual beneficial right cannot be considered to be ownership for the purposes Section 9 of the Indian Income-tax Act, 1922. In that very judgment, the Hon'ble Supreme Court has observed that it is true that equitable considerations are irrelevant in interpreting tax laws. But those laws, like all other laws, are to be interpreted reasonably and in consonance with justice.
17. The next item of the property involved is regarding the godown at Barabazar, Shillong. The assessee contended that the land did not belong to her but to the Syiem of Mylliem and she had to pay periodical rent for the land on which she had raised a godown structure of Assam type measuring 150 sq.ft. The authorities below pointed out that the assessee having made this investment should have shown the value of this property. To a limited extent we agree with the inferences of the authorities below in respect of this property. At least, the superstructure in the shape of 'Assam type godown' or the amount invested thereon should have been shown by the assessee in the wealth-tax return for the year. Having not done so, this superstructure in the shape of a godown could be said to have not been disclosed in the return. But as far as the land is concerned, it could not be said that the same was belonging to the assessee in her capacity as a tenant so as to show or disclose the said land in her wealth-tax return. Thus, for the purpose of penalty, the inclusion of the value of this Barabazar land, though included in the assessment rightly or wrongly, should be excluded as the assessee could not be said to have concealed or not disclosed an item, which was not 'belonging' to the assessee. So such property would have to be excluded for the purpose of evaluation as to the point whether there could be concealment of such property. Thus, we are of the opinion that as far as the Barabazar land is concerned, there could be no charge of concealment though the very land itself was rightly or wrongly included in the assessment.
18. We shall come now to the next property noted by the WTO to have been disclosed by the assessee in respect of the land at Cantonment area which value was returned at Nil on the plea that this land belonged to the cantonment authority, i.e., defence authority and the assessee was holding a leasehold right on the land which can be taken over by Defence Department at any time without payment of any compensation. The WTO pointed out that the assessee herself has purchased this asset from one Smt. Uma Rani Chakraborty on 21-8/9-1978 for Rs. 80,000. It appears that it was a lease obtained by Smt. Chakraborty from the Defence Ministry and the lease was purchased by this assessee from Mrs. Uma Rani Chakraborty. There are no further details available. In other words, the lease must have been for a certain stipulated time as the Defence Department would not have given a perpetual lease, particularly when it may require land for defence purposes at any time and is not obliged to pay any compensation. Besides, some years must have elapsed from the time when Mrs. Chakraborty obtained the lease from the Cantonment authority till the time when this assessee bought this property. In other words, the period of the lease had expired to some extent and thereby leaving shorter period of the unexpired period of the lease. A leasehold right may have a market value as observed by the CWT(A) in the impugned order. But he has lost sight of the fact that the value of periodical lease would be diminished as it approaches expiry date. Thus, the market value of such lease right would go on diminishing as the years of the unexpired period go by. The facts of the case of P.S. Gandhi v. CWT [1983] 141 ITR 105 (All.), relied on by the CWT(A) were on different set of facts though the facts of the present case bears limited similarity. In the present case, there was only land no construction was raised by the assessee on the said cantonment land as could be ascertained from the orders of the authorities below. The cost paid for by the assessee could not be ascertained whether it was for the lease right or for some other properties as these aspects have not been dealt with by the authorities below. Normally a person would not have invested a substantial amount in a property which is not likely to yield any income or any return. Be that as it may, it appears that the assessee has obtained the lease right from Mrs. Chakraborty and this lease right has an intrinsic value of its own. In other words, such value should have been shown in the return as the existence of the property has been noted in the return itself. The assessee claimed that the value should be at nil in view of the circumstances stated; whereas the WTO did not accept that the value should be at nil. From these facts, it is clear that it could not be said that the assessee had not disclosed the existence of this property as alleged. The other aspects of the matter is regarding the valuation which the assessee had shown at nil. But the WTO apparently had taken the value at Rs. 80,000. But as pointed out before, the lease amount was paid for at Rs. 80,000 much earlier and the period of the lease meanwhile, is going on reducing. Thus, the cost of acquisition of the lease earlier cannot be taken to be as correct in this year when the lease period goes on reducing from year to year. Thus, as far as the valuation matter is concerned, in the absence of direct evidence or direct materials, one has to give his own estimate. The assessee estimated the value at 'nil'' whereas the WTO took the value at a different figure. Thus estimate is an estimate.
19. The other property is regarding the house property located at Jaiaw. According to the assessee that property did not belong to her but to her clan and, therefore, the same could not have been shown in her wealth-tax return. The WTO did not agree with the assessee as the assessee herself had disclosed the value of this property in her return for the assessment years 1985-86 and 1986-87. The year with which we are presently concerned is 1979-80. The WTO, therefore, held that the claim of the assessee that this property belonged to the clan was not acceptable. On appeal by the assessee, the CWT(A) did not agree with any of the contentions of the assessee as discussed in the earlier paragraphs.
20. We have gone through the orders of the authorities below for our consideration along with the submissions made by both the sides. In respect of the Jaiaw house property, the assessee submitted that the property belonged to the clan and not to her. The WTO declined to accept the contention as the assessee herself had shown this property in her wealth-tax return for the assessment years 1985-86 and 1986-87. Hence, the penalty was imposed on this point, which was sustained by the CWT(A) on the same reasonings. In our opinion, as far as this property is concerned, the penalty was imposed on irrelevant material. In taxation matters, each year is independent. It is highly unjustified to penalise or to make an assessment of a particular year on the basis or on the material available for any subsequent year. It is not known as to why the assessee had shown those properties in her later years return. On this ground alone, the penalty in respect of this Jaiaw house property cannot be sustained. That apart, as indicated earlier, the Appellate Tribunal, in a similar situation in the case of Mrs. C. Pyngrope (supra), on the facts recorded therein, held at para-26 that it was difficult to hold that the assessee, i.e., Mrs. Pyngrope can be assessed to wealth-tax for this purpose as the properties in effect belonged to the clan. We have taken into account also the reliance placed by the assessee on the Notes on the Khasi Laws (supra). We have mentioned earlier that liability to wealth-tax would arise when such property can be held as 'belonging' to such assessee. Since the clan property cannot be said to be belonging to the assessee, there cannot be any question of inclusion of such property in the assessment of this assessee.
21. As far as the non-inclusion of the superstructure of the godown at Barabazar land is concerned, we find that there is no material to say as to why the assessee did not show the value of the superstructure, even though the land in question did not belong to her. Thus, at least to the extent of the superstructure in the form a godown of Assam type is concerned, we find no material as to why the assessee has not shown the same in the wealth-tax return for the year.
22. In respect of the leasehold right on the Cantonment, it can be said that since the assessee had purchased such rights at Rs. 80,000, then there could certainly be a market value of the same after few years though at a much lesser value in view of the fact that the lease period goes on reducing from year to year.
23. It is seen, however, that the authorities below have imposed the penalty mainly on the ground that the assessee herself had shown these properties in her wealth-tax return for the subsequent years. Be that as it may, but that cannot be taken as the basis for imposition of penalty on the ground that the property belonged to the assessee. What the assessee had shown or had not shown in the accounts or in the return could not be said to be conclusive or final. It could not be said that if the assessee did not show any property in the return, then such property did not belong to her and at the same time, if the assessee had shown rightly or wrongly a particular property in the return, the same should be taken as belonging to her. Each fact will have to be considered in its own setting. At the same time, penalty cannot be imposed for this year on the ground that for the assessment year 1985-86, the assessee had shown such wealth in the return.
24. As indicated earlier, there is no appeal pending in respect of the quantum. In other words, the assessment has become final. As pointed out by the revenue, the assessee had accepted the assessment orders. But that by itself would not be sufficient to hold or to infer that the assessee had admitted that such property belonged to her, assessable in her hands and for concealment of which, penalty was leviable. Admission or acceptance of certain point should be a qualified one as there could be many reasons as to why such acceptance was made. There were cases under the income-tax proceedings in respect of cash credit etc., and the explanation of the assessee was not considered proper and the assessee agreed that those amounts may be taxed, with a view to purchase peace or to avoid botheration. For such proposition, we may refer to certain decisions in CIT v. Narang & Co. [1975] 98 ITR 462 (Delhi), CIT v. M. Bhuta & Co. [1976] 103 ITR 183 (Bom.) and CIT v. Gajan and Shyamlal [1978] 111 ITR 816(Gauhati). The Hon'ble Allahabad High Court in the case of CIT v. Mansa Ram & Sons [1977] 106 ITR 307, amongst other things, held that on agreeing to the application of higher rate of profit, the imposition of penalty on that basis alone was found to be not well founded. The Hon'ble Andhra Pradesh High Court in the case of CIT v. C.V.C. Mining Co. [1976] 102 ITR 830 has held on the facts of that case that the mere fact that the assessee had agreed to be assessed, at a higher figure than the returned income, is not a proof of admission of concealment by the assessee and that fact cannot give a good foundation to the imposition of penalty.
25. In connection with income-tax penalty proceedings, in the case of M. Bhuta & Co. (supra), the Hon'ble Bombay High Court held on the facts of that that the penalty proceedings were regarding declaration of stock by the assessee to the Bank was higher. It was noticed that it was only in respect of part of this stock that no proper explanation was offered by the assessee. But there was no admission of concealment of income as such either during the assessment proceedings or during the penalty proceedings and as such this was not a case of deliberate concealment of income or furnishing of inaccurate particulars by the assessee for which penalty could not be levied. In the present case before us also, we find that the assessee had not categorically admitted concealment as it appears that the assessee was under a bona fide belief that the value of the Cantonment area was nil or that the Barabazar land property was not includible. The contention of the assessee might not have been accepted but rejected as not acceptable. But that should not lead to the conclusion that concealment was made by the assessee in the absence of any other material or findings . The Hon'ble Gauhati High Court in the case of CIT v. Tezpur Roller & Flour Mills [1976] 1.03 ITR 259 has observed on the facts of that case that apart from the falsity of the explanation given by the assessee, there was no cogent material or evidence from which it could be inferred that the assessee had consciously concealed the particulars of income or had deliberately furnished inaccurate particulars. This was in connection with the income-tax penalty proceedings. But the provisions of wealth-tax penalty proceedings are similar with those of the income-tax proceedings. The Hon'ble Punjab and Haryana High Court in the case of Krishan Lal Shiv Chand Rai v. CIT [1973] 88 ITR 293, held that on the facts of that case that penalty proceedings are distinct from the assessment proceedings and are in the nature of quasi-criminal proceedings and that the onus was on the department to prove positively and produce other materials besides the factum of surrender that the amounts in dispute were the undisclosed income of the assessee as the surrender by the assessee could have been for more than one reason in spite of the fact that is was not his income and that fact alone could not be the basis for imposition of penalty. Similar view was expressed by the Hon'ble Andhra Pradesh High Court in the case of C.V.C. Mining Co. (supra) as dealt with by us earlier.
26. In a different context and under the provisions of the Central Sales-tax Act, 1956, the Hon'ble Supreme Court in the case of Cement Marketing Co, of India Ltd. v. Assistant Commissioner of Sales-tax [1980] 124 ITR 15 has on the facts of that case, held that a return can be 'false' unless there is an element of deliberateness in it. It was observed that it was possible that even where the incorrectness of the return is claimed to be due to want of care on the part of the assessee and there was no reasonable explanation from the assessee for such want of care, the court may infer deliberation and the return may be liable to be branded as a false return. The Hon'ble Supreme Court observed that, however, where the assessee did not include a particular item in the taxable turnover under the bonafide belief that the assessee was not liable to include it, it would not be right to condemn the return as 'false' return inviting penally under the provisions of the said Act.
27. Amongst other things, the properties of the assessee included a lease right in the Cantonment land. Accordingly, the conditions of the lease would have to be taken into account and how such conditions would affect valuation of such property for the purpose of wealth-tax. A similar situation was dealt with by the Hon'ble supreme Court in the case of CWT v. P. N. Sikand [1977] 107 ITR 922. Amongst other things it was held that in determining the value of the leasehold interest in the land, the price which the leasehold interest would fetch in the open market were it not encumbered or affected by the burden or restriction contained in the lease deed, would have to be reduced by 50 per cent of the unearned increase in the value of the land on the basis of the hypothetical sale on the valuation date. In that particular case, there was some stipulation in the lease as to surrender 50 per cent of the unearned increase to the lessor. In other words, in making the valuation regarding leasehold right, a number of things would have to be taken into account in order to arrive at a fair market value and not merely on the basis of the cost price at which such bundles of rights had been acquired by a particular assessee. The diminishing value of the leasehold right in the present case has been taken at cost price even after long lapse of time.
28. In respect of the clan property, the assessee may have a right of residence, as pointed out earlier. But right of residence is not capable of evaluation. In an estate duty matter, the Hon'ble Bombay High Court in the case of D.J. Gazdar v. CED [1982] 138 ITR 607, held on the facts of that case that the right did not extend to any income from property, which is not capable of valuation. Therefore, though such asset was deemed to have passed on the death of the deceased, yet the benefits accruing there from was not liable to estate duty.
29. Thus from whatever view we may look at the various contentions of both the sides, vis-a-vis, the position of law, as dealt with by different High Courts and Supreme Court, we find that there was no concealment of particulars in the present case as we do not find any material even to infer that the assessee had deliberately or mala fide declined to include such items of assets in her wealth-tax return, although the WTO did not accept the contentions of the assessee that such properties did not belong to her.
30. Although the assessee in the present case had not preferred appeal against the quantum orders for the years under appeal, it could not be said that the assessee has estoppel from asserting her right in penalty proceedings as there is no estoppel against the statute. In the case of C.K. Mehta [1982] 2 SCR, Part I (sic) the Hon'ble Supreme Court observed on the facts of that case that there is marked difference between the assertion and estoppel. It was observed that a man is not estopped from asserting a right which he had stated that he would not assert. Thus, the fact that in the present case, the assessee did not assert her right of appeal against the inclusion or against the valuation of such included assets in the quantum appeals, yet the assessee is not precluded or estopped from asserting her claim as discussed in the preceding paragraphs in course of the penalty proceedings.
31. Thus, keeping in view the position discussed above, we cannot sustain the orders of the CIT(A) by which he has upheld the penalty orders.
32. In the result, the appeals by the assessee are allowed.