Income Tax Appellate Tribunal - Chennai
Gedee Investments Private ... vs Deputy Commissioner Of Wealth Tax, ... on 18 March, 2026
आयकर अपील य अ धकरण, 'ए' यायपीठ, चे नई।
IN THE INCOME TAX APPELLATE TRIBUNAL
'A' BENCH: CHENNAI
ी मनु कुमार िग र, ाियक सद एवं ी एस. आर. रघुनाथा, ले खा सद के सम
BEFORE SHRI MANU KUMAR GIRI, JUDICIAL MEMBER AND
SHRI S.R.RAGHUNATHA, ACCOUNTANT MEMBER
आयकर अपील सं./WTA No 7/Chny/2025
नधारण वष/Assessment Year: 2015-16
GEDEE INVESTMENTS PRIVATE LIMITED v. Deputy Commissioner of Wealth
317, Avinashi Road, Gopal Bagh Tax, Corporate Circle -1
Coimbatore-641018 Coimbatore
[PAN: AAACG 6572 E]
(अपीलाथ /Appellant) ( यथ /Respondent)
अपीलाथ क ओर से/ Appellant/Assessee by : Ms. T. Sandhyaarthi, CA
यथ क ओर से /Respondent/Revenue by : Ms E. Pavuna Sundari, CIT
सुनवाई क तार ख/Date of Hearing : 12.01.2026
घोषणाक तार ख /Date of Pronouncement : 18.03.2026
आदे श / O R D E R
PER MANU KUMAR GIRI, JM:
The captioned appeal by the assessee is arising out of the order of the Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi dated 19.06.2025 for AY 2015-16.
2. The Ld. AR for the assessee has raised the following grounds of appeal as under:-
1. The Ld. CIT(A) erred in confirming the addition made by the Ld. AO to the net wealth of the appellant without WTA 7 Chny 2025 (A.Y. 2015-16) Gedee Investments Pvt Ltd vs DCWT CC 1 Coimbatore :: 2 ::
properly appreciating the law, facts and circumstances of the case.
1.2 The Ld. CIT(A) failed to take into account that during the year under consideration, part of the property was partly used for the Company's own purposes and partly let out, thereby qualifying for exclusion under Section 2(ca)(i) of the Wealth Tax Act, 1957.
1.3 The Ld. CIT(A) overlooked the fact that for the said year, the appellant has paid electricity charges, property tax and water tax evidenced by respective receipts which prove that the property was commercially exploited, thereby qualifying for exclusion under Section 2(ea)(i).
1.4 The Ld. CIT(A) has erred by not appreciating that the legislative intent behind the Wealth-tax Act, as reflected in the Memorandum to the Finance Bill, 1992 and CBDT Circular No. 636 dated 31.08.1992, is to tax only idle and non-productive assets and not business or commercially exploited properties. The impugned addition defeats this purpose and is unsustainable.
1.5 Without prejudice to the above, the Ld. CIT(A) grossly erred in passing the impugned order on 19.06.2025, even though time was granted to the appellant till 20.06.2025 for filing a response. By doing so, the Ld. CIT(A) had denied the appellant a reasonable opportunity of being heard, rendering the order violative of the principles of natural justice and therefore unsustainable in law.
1.6 The Ld. CIT(A) failed to consider that the Assessing Officer had erroneously levied consequential interest under Section 17B, which is not tenable in law.
1.7 The appellant seeks your leave to add, alter, amend, or withdraw any or all the above grounds at the time of hearing.
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3. The brief facts of the case are that the case of the appellant for the AY 2016-17 was selected for scrutiny through CASS, wherein, one of the reasons was about the verification of Sale consideration of property and long term capital gains. On verification of ITR, it is noticed that the appellant company has sold immovable property at Chennai for a consideration of Rs.18,60,00,000/- during the financial year 2015-16 relevant to the assessment year 2016-17. The assets sold by the appellant company originally consisted of land and building. The building was demolished during the financial year 2014-15 in pursuance of demolition order dated 22.04.2014 by the Chennai Corporation. Hence as on valuation date 31.3.2015, the land alone was in existence, the market value of which attracts wealth tax for AY 2015-16. Despite having taxable wealth of at least Rs.18,60,00,000/-, appellant company has not filed Return of Wealth for the year under consideration. As there was reason to believe that wealth chargeable to wealth tax has escaped assessment notice u/s.17 of the Wealth Tax Act, 1957 ('Act' in short) was issued to the appellant on 12.6.2019. In response to the notices the appellant filed Return of wealth on 02.03.2021 declaring WTA 7 Chny 2025 (A.Y. 2015-16) Gedee Investments Pvt Ltd vs DCWT CC 1 Coimbatore :: 4 ::
total wealth of Rs.53,51,710/- and paid Rs.38,803/-including interest.
During the course of wealth tax proceedings, notices were issued to the appellant. In response, the appellant submitted its response from time to time.
Therefore, keeping in view the facts, circumstances, reply and material available on record, the AO completed assessment on 30.03.2021 at the net wealth at Rs.18,83,51,700/- by making an addition of Rs.18,60,00,000/- on account of 'Urban Land' to the new wealth declared by the appellant.
4. Ground wise submission as under:
i. The property in the question was used by the Appellant partly for business purposes and partly let out, and thereby, exempt from the scope of Wealth Tax applicability. Sufficient proof of occupancy and usage of business premise/let-out space can be provided and the copy of ledger extract for the payment of electricity for the period up to February 2016 is attached herewith and a share of electricity charges recovered from the group company for its branch office therein. It is also noted that the property tax and water tax payments was paid up to first-half of 2015-16 and the copy of property tax and water tax cards are enclosed vide Annexure-3.
ii. This shows that the office of the group company was functioning in the remaining part of the building up to a period of February 2016 even though part of the building was demolished.
iii. However, as the building was in a dilapidated condition, the Appellant company had demolished the WTA 7 Chny 2025 (A.Y. 2015-16) Gedee Investments Pvt Ltd vs DCWT CC 1 Coimbatore :: 5 ::
building as ordered by the Corporation of Chennai for safety reasons in F.Y. 2014-15. This issue would have not arisen if it had been possible to alter the existing structures as such, however such alteration was not permissible by the Chennai Corporation. iv. Considering the requirements of demolition as ordered by Chennai Corporation and the subsequent sale of business by their tenant company with progressing transfer of the Appellant' s operations to Coimbatore, the Appellant prudently effected the safe transaction in the financial year 2015-16. The learned assessing officer is erred in qualifying the land as urban land as soon as the building was demolished, without considering the fact necessary planning and approvals to the effect the sale transaction require time, and the dilapidated condition of the property, as valued by the Chennai Corporation at such time, barred any prospective construction considerations. Hence, the applicability of Wealth Tax does not arise.
V. On receipt of the notice dated 18.02.2021 DIN: ITBA/com/F/17/2020-21/1030750503(1) asking various details from the appellant company, in response to the abovementioned notice, the appellant company has submitted all details vide letter dated 01.03.2021 to Corporate Circle 1, Coimbatore on 05.03.2021.
Vi Further notice dated 17.03.2021 DIN: ITBA/Com/F/17/2020-21/1031552475(1) was received by the appellant company, in response to the notice, the appellant company has submitted explanation vide our letter dated 26.03.2021 through e-filing staling our claim as to why the land should not be treated as urban land and brought to tax.
vii. Yet, the assessment order has been passed on 30.03.2021 ex parte, without considering our response dated 01.03.2021 and 26.03.2021. The order has also not been received by us till date. We were not even aware of such an order till date.
viii. After receipt of penalty notice u/s 18(1) r.w.s 18(3) dated 25.11.2021, We were coming to know about the assessment order without mentioning date with WTA 7 Chny 2025 (A.Y. 2015-16) Gedee Investments Pvt Ltd vs DCWT CC 1 Coimbatore :: 6 ::
addition of Rs. 18,60,000.00. It remains unfair that our reply showing cause went unconsidered.
ix. Applicability of Wealth Tax:
House means any building or land appurtenant thereto. However, the following shall not be included in the meaning of house:
1. Any house which the Appellant may occupy for the purposes of any business or profession carried on by him.
2. Any residential property that has been let out for a minimum period of 300 days in the previous year.
The afore-mentioned property serves both purposes that bring the said property outside the purview of Wealth Tax applicability.
X. Urban Land:
The following shall not be treated as urban land:
Land on which construction of building is not permissible under any law for the time being in force in the area in which such land is situated. Under these circumstances it is humbly prayed that our submission be taken on record and the additions of 18,60,00,000 by the assessing officer may kindly be dropped.
5. The ld.CWT(A) has given a following findings:
6.1 The present appeal has been filed by the appellant against the Wealth Tax order passed under section 16(3) r.w.s. 17 of the Act for the AY 2015-16, dated 30.03.2021 by the AO. The appellant is aggrieved by the addition of Rs. 18,60,00,000/- made by the AO to the net wealth of the appellant as per provisions of the Act. The brief facts of the case are that the appellant company sold an asset consisting of land and building. The building was demolished during the financial year 2014-15 in pursuance of demolition order dated 22.04.2014 by the Chennai Corporation. Hence, as on valuation date 31.03.2015, the land alone was in existence, the market value of which attracts wealth tax for AY 2015-16. Despite having taxable wealth of at least Rs 18,60,00,000/-, appellant company has not filed Return of Wealth for the year under consideration. The AO noted that wealth chargeable to wealth tax WTA 7 Chny 2025 (A.Y. 2015-16) Gedee Investments Pvt Ltd vs DCWT CC 1 Coimbatore :: 7 ::
has escaped assessment notice under section 17 of the WT Act, 1957. Consequently, a notice under section 17 of the Act was issued on 12.06.2019. Subsequently, statutory notices under were issued to the appellant. In response to the notices, the appellant filed Return of wealth on 02.03.2021 declaring total wealth of Rs 53,51,710/- and paid Rs 38,803/- including interest.
Accordingly, based on the material available, replies filed by the appellant, the AO completed assessment on 30.03.2021 at the net wealth at Rs. 18,83,51,700/- by making an addition of Rs. 18,60,00,000/- on account of 'Urban Land to the new wealth declared by the appellant.
I have considered all the facts and the material available on record. On perusal of the record, it is observed that the appellant has reiterated that during the year under consideration, part of the building was let out and rest of the part of the building situated on the captioned 'Urban Land' was in use by the appellant company and in support of its claim, the appellant has further stated that it had made property and water tax payments upto the first half of the FY 2015-16.
The submissions of the appellant have been duly considered. However, the same are general and unsubstantiated. The appellant has failed to substantiate the fact that the plant and building was situated on the captioned 'Urban Land', when the Chennai Corporation vide its demolition order dated 22.04.2014 has ordered for the demolition of the said building because of its dilapidated conditions. The question of building being used and let out to some tenant does not arise in such a scenario.
In light of the above facts and circumstances, it is crystal clear that as on date of valuation, i.e. 31.3.2015, the land alone is in existence and the same falls in the category of "Urban Land" which has been covered within the definition of "assets" chargeable to wealth tax u/s 2(ea) of WT Act. Accordingly, the addition made by the AO amounting to Rs. 18,60,00,000/- to the new wealth of the appellant is held to be fully justified. The appellant has failed to provide any credible or verifiable evidence to rebut the findings of the AO. Accordingly, the appeal of the of the appellant is dismissed. 6.2 CO In the result, the appeal is dismissed.
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6. On further appeal before this Tribunal, assessee has filed the following petition for the admission of additional evidence:
WTA 7 Chny 2025 (A.Y. 2015-16) Gedee Investments Pvt Ltd vs DCWT CC 1 Coimbatore :: 9 ::
WTA 7 Chny 2025 (A.Y. 2015-16) Gedee Investments Pvt Ltd vs DCWT CC 1 Coimbatore :: 10 ::
WTA 7 Chny 2025 (A.Y. 2015-16) Gedee Investments Pvt Ltd vs DCWT CC 1 Coimbatore :: 11 ::
7. The ld.AR pleaded that the additional evidence may be admitted and sent back to the file of AO to verify evidence.
8. The Ld.DR objected to the admission of the additional evidence.
9. We have heard the rival submissions of the learned Authorised Representative (Ld. AR) and the learned Departmental Representative (Ld. DR) and perused the material available on record. The assessee has filed a petition for admission of additional evidence before this Tribunal and has submitted that the said evidence goes to the root of the matter for determining whether the impugned property falls within the ambit of "urban land" as defined under Section 2(ea) of the Wealth Tax Act, 1957 or whether the same is eligible for exclusion on account of being used for business purposes and partly let out. The Ld. AR submitted that additional evidence, such as electricity bills, property tax receipts, water tax receipts and supporting documents indicating usage of the property, could not be properly considered by the lower authorities and therefore the same may be admitted in the interest of justice.
10. The Ld. DR, on the other hand, objected to the admission of the additional evidence and submitted that the assessee had sufficient opportunity before the Assessing Officer as well as the Ld. CWT(A) to produce such material and therefore the same should not be entertained at this stage.
WTA 7 Chny 2025 (A.Y. 2015-16) Gedee Investments Pvt Ltd vs DCWT CC 1 Coimbatore :: 12 ::
11. We have carefully considered the rival submissions. On perusal of the record, it is noticed that the assessee seeks to place on record certain documentary evidences to substantiate its claim that the property was partly used for its business purposes and partly let out and therefore would fall within the exclusions provided under Section 2(ea) of the Wealth Tax Act, 1957. It is the contention of the assessee that these evidences would demonstrate that the property was commercially exploited and hence would not fall within the category of taxable assets.
12. Considering the nature of the additional evidences sought to be filed and the fact that the same are relevant for proper adjudication of the issue involved in the present appeal, we are of the considered view that the matter requires verification at the level of the Assessing Officer. It is a settled principle that the Tribunal, being the final fact-finding authority, may admit additional evidence if the same is necessary for rendering substantial justice and for proper adjudication of the dispute. In the interest of justice and fair play, we deem it appropriate to admit the additional evidence filed by the assessee and restore the issue to the file of the Assessing Officer for fresh examination. The Assessing Officer shall verify the evidences produced by the assessee and examine the claim of the assessee with regard to the applicability of the provisions of Section 2(ea) of the Wealth Tax Act, 1957, in accordance with law. The Assessing Officer shall provide adequate opportunity of being heard to the assessee WTA 7 Chny 2025 (A.Y. 2015-16) Gedee Investments Pvt Ltd vs DCWT CC 1 Coimbatore :: 13 ::
and thereafter pass a speaking order in accordance with law. Since the matter is being restored to the file of the Assessing Officer for fresh adjudication, the other grounds raised by the assessee are kept open.
13. In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced on the 18th day of March, 2026, in Chennai.
Sd/- Sd/-
(एस. आर. रघुनाथा) (मनु कुमार िग र)
(S.R.RAGHUNATHA) (MANU KUMAR GIRI)
लेखा सद*य/ACCOUNTANT MEMBER या यक सद*य/JUDICIAL MEMBER
चे नई/Chennai,
+दनांक/Dated: 18th March, 2026.
SNDP, Sr. PS
आदे श क त,ल-प अ.े-षत/Copy to:
1. अपीलाथ /Appellant
2. थ /Respondent
3. आयकरआयु /CIT, Chennai / Madurai / Salem / Coimbatore.
4. िवभागीय ितिनिध/DR
5. गाडफाईल/GF