Urgent:- wealth tax implication

This query is : Resolved

CA Rahul Sharma (Querist)
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25 July 2013 I hav a query about wealth tax implication.

Assesse is already assessing as a wealth tax assessee, owning assets above 30 lakhs including 3 house properties
now he has constructed new house in jan 2013 ie in fy 2012-13 and let it out on rent.
as per wealth tax act a house given on rent for 300 days or more is not included in definition of assets.
Now whether this new house is to be included in wealth or not.

that is the matter,please frnd give ur views/advice and whether there is any law/rule/supporting for that
thanks in advance......

CA Vijeta Verma

CA Vijeta Verma (Expert)
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26 July 2013 Definition of assets clearly states that any residental property that has been let out for 300 days or more is not an asset
Accordingly this house shall be included in the wealth of assessee.
If section 5 is applied for exemption then 5(VI) permits only one house to be exempted whether let out or self occupied.
So take exemption for the house whose value is more.

CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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26 July 2013 My personal view is that if house was with the owner only after January 13 then how can the clause of 300 days apply. We need to read and apply the law as per the practical situation

The intention of law is to tax unproductive assets, the asset being discussed has been turned into a productive asset by renting it out albeit for less than 300 days.

Anuj
Femaquery@gmail.com

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CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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26 July 2013 Assuming the date to be 1/1/13 for renting purpose as specific date is not mentioned it is only 31+28+31=90 days of let out.

Hence clause of 300 as rightly said by anuj sir is not applicable and hence is to be included in the assets for fy 12-13.

If next year from 1.4.13 to 25.1.14n it is continously let out or in bricks and peicies it is let out for 300 days or above then next year it can get exempted.

CA Rahul Sharma

CA Rahul Sharma (Querist)
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28 July 2013 thanks to all for their views,
I think it should be included in wealth.

CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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28 July 2013 No........In my personal view,it should not be incuded.

I look for other experts to give their views.

Anuj

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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02 September 2013 Value of All the houses owned by the assessee are to be added to-gather and the assessee can claim only one house of which the valuation is the highest. As regards 300 days definition the same is if below then if you are taking the valuation on the basis of rental method instead of market value you can treat that house by taking the rental value of 300 days and accordingly if the valuation is more than other houses then-it can be taken as exempted.