N. K. AGRAWAL, J. M. : -
(1.) THESE are four appeals, by the assessee, relating to asst. yrs. 1985-86 to 1988-89, involving common issue and are, therefore, being decided by this consolidated order. The assessee has raised as many as four grounds but the only question relates to the valuation of self-occupied house. The assessee had filed return for relates to the valuation of self-occupied house. The assessee had filed return for asst. yr. 1985-86 declaring net wealth at Rs. 4,86,900. The value of self-occupied house No. 79, Sector 8A, Chandigarh, was shown at Rs. 4,40,000 in accordance with r. 1BB. The WTO noted that the said house had been purchased by the assessee for Rs. 9.05 lakhs and, therefore, he took the purchase price as the value of the property. An addition of Rs. 4,65,000 was made. In next asst. yr. 1986-87, return was filed showing net wealth at Rs. 5,04,658. In this year again, the assessee showed the value of the self-occupied house at Rs. 4,40,000. The WTO again raised the valuation to the purchase price of the house at Rs. 9,05,000. In asst. yr. 1987-88 return showing net wealth at Rs. 5,37,900 was filed and the WTO made addition of Rs. 4,65,000, as was done in earlier years. In asst. yr. 1988-89, return was filed showing net wealth at Rs. 4,78,700. In this year also, addition to the tune of Rs. 4,65,000 was made on the basis of the purchase price of the house.
(2.) The learned counsel has invited our attention to the decision of the Honble Supreme Court reported as Bharat Hari Singhania vs. CWT 119 Taxation 112. In that case, r. 1D framed under s. 7 was under examination and it was held that the rule was mandatory. It was held that r. 1D was a valid piece of legislation and the WTO was bound to follow it in valuing unquoted equity shares. It was held that r. 1D is perfectly valid and effective and has to be followed in every case where unquoted equity shares of a company have to be valued. All the authorities under the Act are bound by the said rule. The question of the rule being mandatory or directory, does not arise. The learned counsel has, on analogy of the said judgment, contended that r. 1BB is also of the same status and effect and, therefore, it should also be treated with the same sanctity as r. 1D was held by the Honble apex Court. Our attention has also been drawn to CWT vs. Hiralal Mehra (1994) 205 ITR 122 (P&H), wherein r. 1BB has been held to be applicable upto 31st March, 1989. Rule 1BB was omitted by the WT (Second Amendment) Rules, 1989, w.e.f. 1st April, 1989. Therefore, for assessment years under consideration, r. 1BB shall be applicable.
We find force in the contention of the learned counsel and are of the view that r. 1BB has to be followed in the assessees case for all the four years under consideration. The judgment of the Honble Supreme Court on the applicability of r. 1D is very authoritative on the question of applicability of r. 1D and r. 1BB also stands on the same footing as r. 1D. Therefore, we hold that r. 1BB is applicable in the assessees case for valuation of self-occupied property. The WTO is directed to fix the value of the self-occupied property in accordance with r. 1BB.
(3.) IN the result, all the appeals succeed and are allowed.;