1998 PLP (Trib (PTD)

11.96 " 3 " 3" 17.96

3. Prudential Invest. Bank Ltd. 4500 "? 10" 5" 5" 20"

4. Prudential' Fund? Management Ltd. 2900 " 10" 5" 5 " 20 "

5. First Pak Modaraba 1332 " 10" 5 " ????? 5 "?? 20 " Total: 17569 5196 23 23 97.96 ???????????

4. The assessing officer after determining the above monthly rent capitalised the same for 10 years in the assessment years 1992-93 and 1994-95 and at 12 times in the assessment year 1993-94.

5. The learned CIT(A) did not approve the above valuation and issued directions reproduced in the earlier part of this order with which the department is aggrieved.

6. The learned D.R. has submitted that the formula adopted by the learned CIT(A) is not in consonance with the law as contained in the Wealth Tax Act and the rules framed thereunder. According to learned D.R. the valuation is to be taken on the valuation date and. when the property is admittedly rented out it is to be worked out on the basis of G.A.R.V., which was determined by the assessing officer. On the other hand Mr. Akbar G. Merchant, learned counsel for the appellants has submitted that the learned CIT(A) has rightly directed for increase of 10 % over and above the purchase price to which no exception can be taken. However, when it was pointed out to the learned counsel that the formula though may appear beneficial to the assessee in this case but it is likely to cause great hardship if increase at % over the value determined by the department in respect of the immovable properties is allowed in the case of all the assessees, the learned counsel conceded to this proposition. After considering the contentions raised before us and going through the assessment order and the first appellate order we are of the opinion that the issue relating to the valuation of property has not been considered in right perspective by either of the officer. The properties held by the respondent have been admittedly rented out and the tenancy agreement has been duly executed. A perusal of the tenancy agreements shows that the landlord and tenants have bifurcated the total amount received by the landlord in three categories. First Category is of the rent, second category is of building maintenance and the third category is of the charges for lift and other amenities. The learned counsel for the assessee has stated that so far the amount of rent shown in the tenancy agreement is concerned there is no dispute over it. The bone of contention between the assessee and department is of the charges received for building maintenance and lift and other amenities are to be included in the rent. According to assessee the entire amount charged for building maintenance and lift and other amenities should be excluded from the rent of property. While according to department the entire amount is to be included in the rental of the property.

7. We have given our anxious consideration to the material placed on record and contentions raised by the learned representatives for the parties. We are not persuaded to agree with the submission of any of the, learned representatives of the parties in toto as a Division Bench of this Tribunal has already held in Wealth Tax Appeal No. 102/KB of 1984-85 vide order dated 10-11-1988 that tie charges for lift and parking place is to be included in the rent. Thus applying the same principle the rent charged for the central air-conditioning system is also to be included in the rent for the building. The reason being that according to the provision contained in Rule 8(3) of the Wealth Tax Rules the value of building is to be estimated with due regard of the nature and size of property and the amenities available. The learned counsel for the assessee has conceded that the lift and central air-conditioning system falls within the purview of amenities available with the building. However, at the same time the amount charged for the consumption of electricity, salary to the Chowkidar, sweeper, security guard and other expenses incurred for cleaning and maintenance of building cannot be included in the rental of the building. We, therefore, maintain the setting aside of the assessment but vacate the directions by the learned CIT(A). It is directed that while re-determining the value of properties for the purpose of Wealth Tax the amount being charged under the head rent should be included in the G.A.R.V. while bifurcation should be sought for from the assessee in respect of charges for building maintenance, lift, central air-conditioning system and other amenities. The charges on account of parking place which is a part of building and charges on account of lift and central air-?conditioning system which have also become part and parcel of the building and fall within the purview of amenities are also to be included in the rental being charged from the tenants. The amount of salaries paid to the Chowkidar, sweeper, security guard etc. and the amount of electricity charges paid to the K. E. S. C. on account of consumption in-the central, air-?conditioning system, lift, parking places, corridors and other open spaces as well as the expenses for the purpose of cleaning and maintenance of building should be excluded from the rental of the building. The burden of proving as to how much amount out of the building maintenance, lift, central air-?conditioning system, parking place is allocable to the rent and how much of the amount is allocable to the expenses other than the building itself and the amenities attached to it, shall be on the assessee. The assessing officer shall exclude only that amount from the rental which is shown by the assessee to have been incurred for the purposes which cannot be treated to be charges for the building and amenities attached to it.

8. The appeals stand disposed of as above. M.B.A./515/Trib. ??????? ??????????????????????????????????????????????????????????????????????? Order accordingly.