S.K. Jain, Judicial Member - (1.) A common point is involved in these two appeals filed by the assessee against the consolidated order dated 6-1-1987 of the AAC of Wealth-tax relating to inter alia the A.Ys. 1983-84 and 1984-85.
(2.) The assessee along with other three co-sharers was the owner of an agricultural land situate in village Sirpur, District Indore. All the four co-owners sold the said land for a cash consideration of Rs. 1,85,000 to Shri Hari Grah Nirman Sahkari Sanstha by an unregistered sale deed dated 22-11-1981. The said cash consideration of the share of the assessee amounting to Rs. 46,250 was included by the WTO in the wealth of the assessee which was unsuccessfully resisted in appeal before the AAC of Wealth-tax. Hence, this second appeal. The contention of the learned counsel for the assessee is that since the sale deed was not registered there was no valid transfer of the land in favour of the purchaser and the assessee still remained owner of the said land. Reliance thereby is placed upon the judgment of the Hon'ble Supreme Court in the case of Nawab Sir Mir Osman Ali Khan v. CWT. Thus, whatever sale consideration has been received by the assessee is only an advance sale price which is liable to be refunded to the purchaser in the event of failure of title of the purchaser. Thus, according to him, it was a debt refundable to the purchaser till a valid title is transferred by a registered sale deed and it cannot be taken as a wealth of the assessee and if it is included in the wealth of the assessee, it is to be deducted as a liability. It is pertinent to notice at this stage that the said land being agricultural is exempt from being included in the wealth of the assessee.
(3.) THE contention of the learned Departmental Representative is that the sale is complete in all respects but for its registration. It is also pointed out by him that the assessee had delivered possession of the said land on 20-6-1976, i.e., to say, about five years before the execution of the said sale deed on receipt of full consideration thereof and there was no warranty in the sale deed for failure of title of the purchaser. It is also contended by him that the sale deed also mentioned that in case of acquisition of the said land the purchaser was entitled to receive the compensation ; furthermore it was for the purchaser to complete all the legal formalities at its own cost for getting a valid sale deed registered. THE sale deed could not be registered for the proceedings under the Urban Ceiling Act was pending. Thus, in substance, contention of the learned Departmental Representative is that the exempted asset in the shape of agricultural land was unconditionally converted by the assessee in the shape of cash which cannot be treated as liability of the assessee.;