Full Judgment Text
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PETITIONER:
F.S. GANDHI (DEAD) BY LRS.
Vs.
RESPONDENT:
COMMISSIONER OF WEALTH TAX, ALLAHABAD
DATE OF JUDGMENT02/05/1990
BENCH:
AGRAWAL, S.C. (J)
BENCH:
AGRAWAL, S.C. (J)
KULDIP SINGH (J)
CITATION:
1991 AIR 1866 1990 SCR (2) 886
1990 SCC (3) 624 JT 1990 (3) 476
1990 SCALE (1)89
ACT:
Wealth Tax Act, 1957: Section 2(e) 2(iii)--Interest in
respect of properties--Lease of lands on which properties
were standing expired--Tenancy continued on month to month
basis for unstated period--Whether liable to tax.
Words and Phrases--’Is’ and ’has been’--meaning of.
HEADNOTE:
The appellant-assessee owned certain properties on
lease-hold lands. The leases in respect of these lands
expired in 1958 and 1963 and the lessor--State Government
issued notices to the assessee to hand over vacant posses-
sion of the leasehold lands. The properties were let out to
the tenants and the assessee was receiving rental income
from the same.
In the Wealth Tax Returns for the assessment years
1971-72, 1972-73, 1973-74 and 1974-75, the assessee valued
the properties at ten times of the annual rental income. In
the assessment order the Wealth Tax Officer valued the
properties at fifteen times of the annual rental income. On
appeal, the Appellate Assistant Commissioner of Wealth Tax
valued the said properties at twelve and a half times of the
annual rental income.
On further appeal, the Income Tax Appellate Tribunal
valued the properties at ten times of the annual rental
income, but, at the request of the assessee, referred to the
High Court for its opinion certain questions of law, includ-
ing the questions whether the Tribunal was right in holding
that the properties in respect of which the leases had
expired in 1958 and 1963 and notices had been issued to hand
over the possession were assets within the meaning of Sec-
tion 2(e)(v) of the Wealth Tax Act, 1957 and its value was
liable to be included in the net wealth of the assessee and
that, on correct interpretation of Section 2(e)(v) of the
Wealth Tax Act, and relevant provisions of the Transfer of
Property Act, the interest of the appellant in respect of
properties in dispute was for a period of over six years.
887
The High Court held that after the determination of the
earlier leases, the assessee was lessee of properties under
a new contract of tenancy, and it was a tenancy from month
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to month under Section 116 read with Section 106 of the
Transfer of Property Act, and for an unstated period, and
could not be said to be precarious in nature, that the said
tenancy was an asset as defined in Section 2(e) of the Act
and was not excluded under sub-clause (v) because the said
interest had been available to the assessee for a period
exceeding six years from the date the new contract of tenan-
cy came into existence. It, however granted certificate of
fitness to appeal to the Supreme Court.
Allowing the appeals, this Court,
HELD: 1. The properties in respect of which leases had
expired in 1958 and 1963 and notices had been received by
the assessee to hand over the possession were not assets
within the meaning of Section 2(e)(2)(iii) of the Wealth Tax
Act 1957 and the valuation of the same was not ’liable to be
included in the net wealth of the assessee. The Tribunal was
not right in holding that the interest of the assessee in
respect of the properties in dispute was for a period over
six years for the purpose of Section 2(e)(2)(iii) of the
Act.[898F-H]
2.1 The word "available" in Section 2(e)(2)(iii) of the
Act is preceded by the word "is" and is followed by the
words "for a period not exceeding six years". The word ’is’,
although normally referring to the present, often has a
future meaning. It may also have a past signification as in
the sense of ’has been’. In view of the words "for a period
not exceeding six years" which follow the word "available",
the word ’is’ must be construed as referring to the present
and the future. In that sense, it would mean that the inter-
est is presently available and is to be available in future
for a period not exceeding six years. [896C-D]
The High Court has construed the word ’is’ to mean ’has
been’. As per the construction placed by the High Court in a
case where an interest has been created for a period exceed-
ing six years it would be included in the assets of the
assessee under Section 2(e) of the Act only after the expiry
of the period of six years even though the interest is
available to the assessee for a period exceeding six years
from the date the interest vests in the assessee. The con-
struction placed by the High Court attaching importance to
the enjoyment of the interest, instead of placing emphasis
on the nature of the interest is not correct. [894E-G]
2.3 The question as to whether the interest should be in-
cluded or
888
excluded from the assets of the assessee under Section
2(e)(2)(iii) of the Act has to be considered in the light of
the nature of interest on the relevant date. Under the said
provision, the relevant date is the date on which the inter-
est vests in the assessee. Therefore, the matter has to be
considered by examining the nature of the interest on the
date the interests vests in the assessee. [894G-H]
Commissioner of Wealth Tax v. Smt. Muthukrishna Ammal,
[1969] 2 S.C.R. 1, relied on.
In the instant case, after the expiry of the leases of
the assessee in the years 1958 and 1963 the assessee contin-
ued in possession under a new contract of tenancy and the
said tenancy was a tenancy from month to month for an un-
stated period. The said tenancy was precarious in nature
because it could be terminated by the lessor, at any time by
a notice under Section 106 of the Transfer of Property Act.
The fact that such a notice was not given cannot mean that
the interest created by the said new tenancy was an interest
available to the assessee for a period exceeding six years
from the date the interest vested in the assessee. In the
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circumstances, in view of Section 2(e)(2)(iii) the said
interest could not be treated as an asset of the assessee
for the purpose of the Act. [897C-D]
[Section 2(e)(v), as amended in 1964, was substituted by
the Finance Act,1969 and the relevant provision applicable
to the instant case was Section 2(e)(2)(iii). However, in
the reference to the High Court, the Tribunal referred to
sub-clause (v) of clause (e) of Section 2, as it stood prior
to the 1969 amendment and the High Court also did not notice
it. This Court observed that since the provisions of Section
2(e)(v) as amended in 1964, were identical with the provi-
sions of Section 2(e)(2)(iii) as substituted by the 1969
amendment the error was of no consequence and examined the
matter in the light of the provisions contained in Section
2(e) as substituted by the 1969 amendment.] [893G-H; 894A]
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 3752-
3755 of 1982.
Appeal by Certificate from the Judgment and Order dated
2.2.1982 of the Allahabad High Court in Wealth Tax Reference
No. 179 of 1978.
S.C. Manchanda, Raja Ram Agarwal, Dr. Meera Agarwal and
R.C. Mishra for the Appellant.
889
Dr. V. Gauri Shankar, Manoj Arora and Ms. A. Subhashini
for the Respondent.
The Judgment of the Court was delivered by
S.C. AGRAWAL, J. These appeals, by certificate granted
by the High Court under Section 29(1) of the Wealth Tax Act,
1957, (hereinafter referred to as ’the Act’) are directed
against the judgment of the High Court of Allahabad dated
February 2, 1982 in Wealth Tax Reference No. 179 of 1978.
The appellant, F.S. Gandhi (hereinafter referred to as
’the assessee’), owns properties situate at Mahatma Gandhi
Marg and Sardar Patel Marg in Civil Lines area at Allahabad.
The lands on which these buildings stand were leased out to
the assessee by the Government of Uttar Pradesh. The leases
in respect of these properties, except the property situate
at 30-A, Mahatma Gandhi Marg, expired in 1958 and the lease
in respect of the property situate at 30-A Mahatama Gandhi
Marg expired in 1963. The Government of Uttar Pradesh issued
notices to the assessee to hand over vacant possession of
the leasehold lands. The properties are let out to the
tenants and the assessee was receiving rental income from
the same. For the assessment years 197 1-72, 1972-73, 1973-
74 and 1974-75 the assessee submitted the Wealth Tax returns
wherein he valued the properties at ten times of the annual
rental income. The Wealth Tax Officer passed assessment
orders wherein he valued the properties at fifteen times of
the annual rental income. On appeal, the Appellate Assistant
Commissioner of Wealth Tax, valued the said properties at
twelve and a half times of the annual rental income. On
further appeal, the Income Tax Appellate Tribunal (hereinaf-
ter referred to as ’the Tribunal’) valued the properties at
ten times of the annual rental income.
At the request of the assessee the Tribunal referred the
following questions of law to the High Court:
"1. Whether on the facts and circumstances of the
case, the Tribunal was fight in holding that properties in
respect of which leases had expired in 1958 and 1963 and
notices had been received to hand over the possession were
assets within the meaning of Section 2(e)(v) of the Wealth
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Tax Act and its value was liable to be included in the net
wealth of the assessee?
890
2. Whether on correct interpretation of Section
2(e)(v) and relevant provisions of Transfer of Property Act,
the Tribunal was right in holding that the interest of the
appellant in respect of properties in dispute was for a
period over six years?
3. Whether there was any material before the Tribunal
to hold that on the relevant valuation date the property
situated at 30-A, Mahatama Gandhi Marg worth ten times of
its annual was rental income while in previous years the
value of the said property was shown and accepted at Rs. 1,
19,000?
4. Whether the Tribunal was right in holding that the
property at 30-A, Mahatama Gandhi Marg, was to be valued on
the basis .of its annual income along with other properties
notwithstanding the property in question was commercial
property while other properties were residential houses and
whether the multiple upheld by the Tribunal is justified in
law and on facts?
5. Whether on the facts and circumstances of the case
the multiple of ten times of rental income in respect of
property at 30-A, Mahatama Gandhi Marg, is not excessive and
wholly unjustified?"
By order dated February 2, 1982, the High Court answered
the said questions in the affirmative, i.e., in favour of
the Department and against the assessee. Thereafter the
assessee moved an application under Section 29(1) of the Act
for grant of certificate of fitness for appeal to this
Court. By ’order dated July 8, 1982, the High Court granted
certificate of fitness on the view that the following ques-
tion is a question of law which is of general importance and
as such this was a fit case in which an appeal could be
filed before this Court:
"Whether on the facts and circumstances of the case the
Tribunal was fight in holding that the properties in respect
to which leases had expired in 1958 and 1963 and notices had
been received to hand over the possession were assets within
the meaning of Section 2(e)(v) of the Wealth Tax Act and its
valuation was liable to be included in the net wealth of the
assessee?"
891
This question was amongst the questions referred to the High
Court. While dealing with the said question the High Court
has held:
"on the determination of a lease by efflux of time or by
notice, it is the duty of the lessee to deliver vacant
possession of the demised premises to the lessor. If he
continues in possession even after the determination of the
lease, his possession is secured inasmuch as the lessor
cannot evict him otherwise than in due course of law and if
he continues in possession without the assent or dissent of
the landlord, he would be a tenant at sufferance. His pos-
session would be wrongful but not unlawful. It is wrongful
because the erstwhile tenant continues in possession beyond
the expiry of the period fixed in the lease. It is not
unlawful because the landlord cannot take law into in his
own hands and evict him. But in case the landlord expresses
his assent by acceptance of rent or otherwise to his contin-
uing in possession this wrongful possession would be con-
verted into a lawful one. The landlord’s assent may be
expresse or implied."
Taking into consideration the facts of the present case
the High Court has found that the leases of the properties
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expired in 1958 and that of 30-A, Mahatama Gandhi Marg in
1963. The High Court has observed:
"There is nothing on record to show that any attempt was
made whatsoever by the State Government to enforce those
notices given by it and the assessee had continued in peace-
ful possession and enjoyment of these properties all along.
In our opinion, therefore, the assent of the landlord to the
assessee’s continuing in possession of these properties can
be inferred and that being so that assessee would be treated
to be a tenant of the same by holding over."
According to the High Court after determination of the
earlier leases the assessee is lessee of properties under a
new contract of tenancy and this tenancy is a tenancy from
month to month under Section 116 read with Section 106 of
the Transfer of Property Act. The High Court has further
held that the present tenancy is a tenancy from month to
month for an unstated period and it could not be said to be
precarious in nature. The High Court was of the view that
the said tenancy is an asset. as defined in Section 2(e) of
the Act and is not
892
excluded under sub-clause (v) because the said interest has
been available to the assessee for a period exceeding six
years from the date the new contract of tenancy came into
existence.
In the Act, as originally enacted, Section 2(e)(v) read
as under: "In .this Act, unless the context otherwise re-
quires--
X X X X X
X
(e) "assets" includes property of every description, movable
or immovable, but does not include--
X X X X X
X
(v) any interest in property where the interest is available
to an assessee for a period not exceeding six years."
By the Wealth Tax (Amendment) Act, 1964 which came into
force with effect from April 1, 1965, the words "from the
date the interest vests in the assessee" were inserted at
the end of sub-clause (v) and thereafter, sub-clause (v)
read as under:
"any interest in property where the interest is available to
an assessee for a period not exceeding six years from the
date the interest vests in the assessee."
By the Finance Act, 1969 clause (e) of Section 2 of the
Act was substituted by the following provision:
"(e)--"assets" includes property of every description,
movable or immovable, but does not include--
(1) in relation to the assessment year commencing on the 1st
day of April, 1969 or any earlier assessment year-
(i) agricultural land and growing crop, grass or standing
trees on such land;
(ii) any building owned or occupied by a cultivator of, or
receiver of rent or revenue out of, agricultural land:
Provided that the building is on or in the immediate
893
vicinity of the land is a building which the cultivator or
the receiver of rent or revenue by reason of his connection
with the land requires as a dwelling house or a store:house
or an outhouse;
(iii) animals;
(iv) a right to any annuity in any case where the terms and
conditions relating thereto preclude the commutation of any
portion thereof into a lump-sum grant;
(v) any interest in property where the interest is available
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to an assessee for a period not exceeding six years from the
date the interest vests in the assessee;
(2) in relation to the assessment year commencing on the 1st
day of April, 1970 or any subsequent assessment year--
(i) animals;
(ii) a right to any annuity in any case where the terms and
conditions relating thereto preclude the commutation of any
portion thereof into a lump-sum grant;
(iii) any interest in property where the interest is avail-
able to an assessee for a period not exceeding six years
from the date the interest vests in the assessee."
As a result of the aforesaid amendment the provision which
is applicable in relation to the assessment year commencing
on the 1st day of April, 1970 and subsequent assessment
years is sub-clause (2) of clause (e) of Section 2. Since
the assessments in question relate to assessment years
1971-72 to 1974-75 the matter has to be considered in the
light of the provisions contained in clause (e) of Section 2
of the Act as substituted by Finance Act, 1969. In framing
questions Nos. 1 and 2 for reference to the High Court the
Tribunal has erroneously made a reference to sub-clause (v)
of clause (e) of Section 2 as it stood prior to the 1969
amendment. The High Court, while answering these questions
and granting the certificate of fitness for appeal to this
Court, did not notice this error. The provisions of Section
2(e)(v) as amended in 1964 are identical with the provisions
of Section 2(e)(2)(iii), as substituted by the 1969 amend-
ment. The error is, therefore, of no consequence and the
matter has been examined by us in the
894
ight of the provisions contained in clause (e) of Section 2,
as substituted in 1969.
Shri R.R. Agarwal, the learned counsel for the appel-
lant, has not disputed the findings recorded by the High
Court that the assessee was n possession of the leasehold
properties as a tenant holding over and hat the said tenancy
was a tenancy from month to month for an restated period.
The submission of Shri Agarwal is that the interest of he
assessee under the said tenancy could not be regarded as an
’asset’ ruder Section 2(e) of the Act and that it has to be
excluded because he said interest cannot be regarded as an
interest available to the assessee for a period exceeding
six years from the date the interest vests in the assessee.
The aforesaid contention of Shri Agarwal involves inter-
pretation of the words "where the interest is available to
an assessee for a period not exceeding six years from the
date the interest vests in the assessee" contained in Sec-
tion 2(e)(2)(iii) of the Act. The word "available" is pre-
ceded by the word "is" and is followed by the words "for a
period not exceeding six years." The word ’is’, although
normally referring to :he present often has a future mean-
ing. It may also have a past signification as in the sense
of ’has been’ (See Black’s Law Dictionary, 5th Edn. P. 745)
We are of the view that in view of the words "for a period
not exceeding six years" which follow the word "available"
the word is’ must be construed as referring to the present
and the future. In that sense it would mean that the inter-
est is presently available and is to be available in future
for a period not exceeding six years. The High Court has
construed the word ’is’ to mean ’has been’. As per the
construction placed by the High Court in a case where an
interest has been created for a period exceeding six years
it would be included in he assets of the assessee under
Section 2(e) of the Act only after the expiry of the period
of six years even though the interest is available to he
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assessee for a period exceeding six years from the date the
interest tests in the assessee. The construction placed by
the High Court instead of placing emphasis on the nature of
the interest attaches importance to the enjoyment of the
interest. We are unable to subscribe to that view. In our
opinion the question as to whether the interest should be
included or excluded from the assets of the assessee under
Section 2(e)(2)(iii) of the Act has to be considered in the
light of he nature of interest on the relevant date. Under
the said provision he relevant date is the date on which the
interest vests in the assessee. Therefore, the matter has to
be considered by examining the nature of the interest on the
date the interest vests in the assessee.
895
This view of ours finds support from the decision of
this Court in Commissioner of Wealth Tax, Madras v. Smt.
Muthukrishna Ammal, [1969] 2 SCR 1 wherein the provisions of
Section 2(e)(v). as it stood prior to the amendment of 1964,
have been considered. In that case the respondent-assessee
had obtained on lease from Government certain salt pans
under two agreement dated January 1, 1943 and January 1,
1945, and each lease was to endure for 25 years but was
liable to be determined by notice on either side at the
close of any salt manufacturing season. In relation to
wealth tax assessment years 1959-60, a question arose as to
whether the assessee’s interest in the salt pans for the
unexpired period of the two leases was liable to be included
in the computation of her net wealth. This Court held that
the interest of the lessee under each lease was precarious
inasmuch as it was liable to be determined by notie by the
Government at the expiry of any manufacturing season and
that the leasehold interest in the salt pans was not avail-
able to the assessee for a period exceeding six years from
the valuation date. It was urged on behalf of the Revenue
that since the assessee had enjoyed the rights under one
lease for 16 years and in the other lease for 14 years and
on the valuation date both the leases were outstanding, the
rights were "assets" within the meaning of the Act and that
the expression "is available to an assessee for a period not
exceeding six years" in clause (v) of Section 2(e) means ’is
and has been available to an assessee for the period of six
years before the date of valuation.’ It was also urged that
if interest in property though revocable has remained unre-
voked for more than six years before the valuation date, the
interest would be an asset within the meaning of Section
2(e). This Court rejected the said contention and held as
under:
"We are unable to agree with that contention. The expression
used by Parliament is "is available to an assessee for a
period not exceeding six years", and it must mean that the
assessee though he has interest in property at the valuation
date the interest will remain available for a period not
exceeding six years. If it is to remain available for six
years or for a shorter period the interest will fall within
the exception: if it is to remain available for a period
exceeding six years it will fall within the definition of
"assets" and its value will be liable to be included in the
net wealth of the assessee. ’ ’
In that case this Court has noticed the amendment intro-
duced in sub-clause (v) of Section 2(e) by the Wealth Tax
(Amendment) Act,
896
1964 but did not consider it necessary to deal with it
because the said matter related to the period prior to the
said amendment.
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The High Court has sought to distinguish this decision
on the view that the position has changed after the amend-
ment introduced in 1964 and that the insertion of the words
’from the date the interest vests in the assessee’ means
that if an interest has been available to the assessee for a
period exceeding six years from the date the interest vests
in the assessee, it would be an asset while prior to its
amendment if the interest was not available to an assessee
for a period not exceeding six years it could not be treated
as an asset. The High Court has observed that as a result of
the amendment of 1964, Section 2(e)(v) can be interpreted to
mean that if an interests has been available to an assessee
for a period exceeding six years from the date the interest
vests in the assessee, it would be asset. We are unable to
agree with the said view. While construing the words "is
available to an assessee for a period not exceeding six
years" this Court in Commissioner of Wealth Tax v. Smt.
Muthukrishna Ammal, (Supra) has rejected the contention
urged by the Revenue that the said words mean "is and has
been available to the assessee for a period of six years"
and this Court has construed the said words to mean that
"the interest will remain available for a period not exceed-
ing six years" meaning thereby that the interest must be
such that on the relevant date it is available presently and
is available for a period not exceeding six years in future.
The only change which was brought about in Section 2(e)(v)
as a result of the amendment introduced in 1964, whereby the
words "from the date the interest vests in the assessee"
were inserted in that sub-clause, was that prior to the said
amendment the relevant date was the valuation date and the
availability of interest had to be seen with reference to
that date and as a result of the amendment of 1964, the
relevant date became the date on which the interest vests in
the asseses and, therefore, the availability of the interest
was to be seen with reference to the date on which the
interest vests in the assessee. But the requirement that on
the relevant date the interest would be available in future
for a period exceeding six years, as held by this Court in
Commissioner of Wealth Tax v. Smt. Muthukrishna Ammal,
(Supra), remained unaltered.
In this context, it may also be mentioned that Commis-
sioner of Wealth Tax v. Smt. Muthukrishna Ammal, (Supra) was
decided by this Court on September 6, 1968. The Finance Act,
1969, whereby clause (e) of Section 2 of the Act was substi-
tuted, was enacted by Parliament on May 13, 1969. In the
amended provisions of clause (e), Parliament has repeated
the same language, namely, "where the interest is avail-
897
able to an assessee for a period not exceeding six years" in
item (v) of sub-clause (1) and in item (iii) of sub-clause
(2). It must be assumed that while enacting the Finance Act,
1969, Parliament was aware of the construction placed by
this Court on these words in Commissioner of Wealth Tax v.
Smt. Muthukrishna Ammal, (Supra). In repeating the said
words in the amended clause (e) of Section 2, Parliament
must be taken to have used the said words to bear the mean-
ing which has been put upon them by this Court in Commis-
sioner of Wealth Tax v. Smt. Muthukrishna Ammal, (Supra).
In the instant case, it has been found that after the
expiry of the leases of the assessee in the years 1958 and
1963 the assessee continued in possession under a new con-
tract of tenancy and the said tenancy was a tenancy from
month to month for an unstated period. The said tenancy was
precarious in nature because it could be terminated by the
lessor, viz., the Government of Uttar Pradesh, at any time
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by a notice under Section 106 of the Transfer of Property
Act. The fact that such a notice was not given cannot mean
that the interest created by the said new tenancy was an
interest available to the assessee for a period exceeding
six years from the date the interest vested in the assessee.
In the circumstances in view of Section 2(e)(2)(iii) the
said interest could not be treated as an asset of the asses-
see for the purpose of the Act.
Our attention has been invited to the decision of the
Allahabad High Court in Purshottam Dass Tandon and Others v.
State of U.P., Lucknow and Others, A.I.R. 1987 All. 56. From
the said decision it appears that a number of petitions were
filed in the Allahabad High Court under Article 226 of the
Constitution of India by lessees who had been granted leases
of nazul lands in Civil Lines area of Allahabad and whose
leases have expired and who were seeking renewal of those
leases. After considering the various orders that were
passed by the Government of Uttar Pradesh, from time to
time, the High Court, while disposing of the said petitions,
has given the following to the opposit parties:
(i) grant fresh leases to all those who had deposited the
premium or at least one instalment on terms and conditions
mentioned in 1959 Order read with 1960 Order;
(ii) issue notices to all those lessees to whom no notice
was issued and determine their premium etc. on terms and
conditions mentioned in 1959-60 Orders expeditiously;
898
(iii) determine premium etc. of others to whom notices were
issued but it could not be finalised for one reason or other
at an early date;
(iv) determine rate of premium etc. for premises which are
used as residential cum commercial purpose in light of 1965
Order;
(v) determine rate of premium used for commercial purpose in
light of various Orders issued till 1965; and
(vi) lessees shall after grant of fresh leases file the
necessary forms etc. within one month before the Prescribed
Authority under Urban Ceiling Act, 1976 (Act 33 of 76) if it
had already not been filed who shall proceed to decide the
same as expeditiously as possible.
In view of the aforesaid directions that have been given
by the High Court it can be said that the assessee whose
leases expired in 1958 and 1963, can ask for grant of fresh
leases on the terms and conditions mentioned in 1959 and
1960 Orders issued by the Government of Uttar Pradesh. In
other words it can be said that in the relevant assessment
years the assessee had the right to obtain fresh leases for
the lands of the properties in question. But there is noth-
ing to show that in pursuance of the said right fresh leases
have been granted by the Government of U.P. in respect of
those lands and such leases were available to the assessee
during the assessment years in question.
For the reasons aforesaid it must be held that the
properties in respect of which leases had expired in 1958
and 1963 and notices had been received by the assessee to
hand over the possession were not assets within the meaning
of section 2(e)(2)(iii) of the Act and the valuation of the
same was not liable to be included in the net wealth of the
assessee. Question No. 1 referred by the Tribunal to the
High Court must, therefore, be answered in the negative i.e.
in favour of the assessee. Question No. 2 referred by the
Tribunal to the High Court is connected with Question No. 1
and both the questions were considered by the High Court
together. Since Question No. 1 is answered in Favour of the
assessee, Question No. 2 must also be answered in the nega-
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tive i.e., in favour of the assessee and it must be held
that the Tribunal was not right in holding that the interest
of the assessee in respect of the properties in dispute was
for a period over six years for the purpose of Section
2(e)(2)(iii) of the Act.
899
In the result the appeals are allowed and the judgment
and order of the High Court is set aside insofar as it
relates to Questions Nos. 1 and 2. The said questions are
answered in favour of the assessee and against the Revenue.
No order as to costs.
N.P.V. Appeals allowed.
900