W.T.A. NOS. 20 AND 21/KB OF 1981-82, DECIDED ON 30TH APRIL, 1988. Versus W.T.A. NOS. 20 AND 21/KB OF 1981-82, DECIDED ON 30TH APRIL, 1988.

ORDER

These four cross-appeals are directed against the combined order of learned A. A. C. recorded by him on 22nd August, 1981 in Wealth-tax Appeal No. AAC/F/(K) (W) 184-85. Since same points of facts and law are arising in all the four appeals, we, therefore, propose to dispose them of by one consolidated order.

2. The brief facts giving rise to these appeals are that the assessee (hereinafter referred to as "the appellant") is a Private Ltd., Co., which owns a six-storeyed building called Al-Yousuf Chambers, Shahrah-e-Liaquat, Karachi. It has 50 to 54 rooms at each floor and 12 godowns at the ground floor. The appellant occupies 4 rooms on 3rd floor and 5 godowns on the ground floor. For assessment years 1979-80 and 1980-81 the appellant filed its wealth-tax returns as shown hereinbelow:

1979-80

1980-81

Actual rent received

Rs. 4,57,927

Actual rent received

Rs. 4,74,240

Capital value at 10 times of the gross rentals

Rs.45,79,270

Capital value at 10 times of the gross rentals

Rs.47,42, 400

Less Liabilities

Rs.31, 42, 270

Less Liabilities

Rs .36, 74, 295

Net Wealth s

Rs.14,36,550

Rs.88,90,935

The Wealth Tax Officer, however, did not accept the annual letting value as declared by the appellant in both the assessment years. In 1979-80, firstly he added Rs.24,339 which was shown as the rent received for godown and secondly, Rs.3,29,486 as interest calculated at the rate of 12% per annum on the amount of security deposit, to the declared annual letting value. The total thereof thus came to Rs.8,11,752 and multiplying it by 10 he obtained the annual market value of the building and after allowing statutory exemption of Rs.5,00,000 calculated the net wealth at Rs.76,17.520. He further levied additional tax under section 31 (b) (1) of the Wealth-tax Act, 1963) hereinafter referred to as "the Act"). Similarly, in assessment year 1980-81, he made two additions of Rs.22,608 and Rs.32,889 to the declared annual letting value for the same reason; as discussed above and arrived at the annual letting value of Hs.5,29,737 and multiplying it by 10 he calculated the market value Rs.52,97,370 and after granting statutory- exemption of Rs.5 lacs arrived at the figure of Rs.47,97,370 as the net wealth and determined wealth-tax thereon. Moreover, in this year also he imposed additional tax under section 57(b)(1) amounting to Rs.9,252. Before proceeding further let us point out at this juncture that. the appellant had claimed liabilities amounting to Rs.31,42,270 and Rs.36,74,295 in 1979-80 and 1980-81 respectively. The break-up of these liabilities as shown by the appellant is as under:

1979-80

Rs.27,45,720

Security Deposits form tenants.

Rs.27,40,780

Rs.3,97,000

Loans.

Rs.9,33,515

Rs.31,42,720

Rs.36,74,295

3. The Wealth Tax Officer, however, did not allow any liability in both the assessment years. The appellant felt very much aggrieved and event up in appeal. The learned A.A.C. vide his impugned order upheld the addition to the ALV of Rs.24,339 and Rs.22,608 on account of rent of the godown, but ordered the deletion of addition, of Rs.3,29,486 and Rs.32,889 as interest calculated at the rate of 12% on the amount of security deposits in both the assessment years. Moreover, the learned A.A.C. accepted the amount of Rs.27.45,72o and Rs.27,40,780 as the liability. But he maintained the disallowance of bank loans. This has given rise to these cross appeals. While the appellant has challenged the addition of Rs.24,.339 and Rs.22,608 to the declared A.L.V., the department has challenged the deletion of Rs.3,29,486 and Rs.32,889. Again the appellant has challenged his finding regarding disallowance of bank loans in both the assessment years and the department has impugned the allowance of security deposits as liability in both the assessment years. Thus, these cross appeals are before us. Mr. Sirajul-Haque has appeared for the appellant whereas Mr. Mohammad Farid, the learned Departmental representative has argued the appeals of the department.

4. Now taking up the first issue, viz., the addition of alleged godown rent of Rs-. 24,339 and Rs.22,608, it appears that the W.T.O. made the addition with the following observation for assessment year 1979-80.

"Scrutiny of the computation filed alongwith the profit and loss account it appears that the assessee has also received godown rent at Rs.24,339 alongwith rental income of 88.4,57,927. Total rent as such is receivable at Rs.4,82,266 as against Rs.4,57,927."

For assessment year 1980-81 the W.T.O. observed:

"Scrutiny of the computation filed alongwith the profit and loss account it appears that the assessee has also received godown rent at Rs.22,608 alongwith rental income of Rs.4,74.230. Total rent as such is receivable at Rs. 4,96,848 as against Rs.4,74,240."

5. From perusal of the impugned order, however, it appears that the learned A.A. C. upheld the finding of the assessing officer for the following reasons: .

"Under the law, only one residential house, under self -occupation of go assessee, is exempt from tax. This exemption, however, does not extend to self-occupied property used for commercial purposes."

Mr. Sirajul-Haque, the learned counsel for the appellant attacking the finding of both the officers below firstly invited our attention to definition of assets as contained in Section 2 (1) (e) which reads as under:

2. Definitions.-- In this Act, unless the context otherwise requires-

(1) Appellate Assistant Commissioner means a person appointed to be an Appellate Assistant Commissioner under section 9;

(e) assets includes-

(i) in the case of an individual and a Hindu undivided family, property of every description movable or immovable, except--

(a) growing crops, grass or standing trees on agricultural land; and

(b) any building owned or occupied by a cultivator or receiver of rent or revenue out of agricultural land;

Provided that the building is on or in the immediate vicinity of the land and 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; and

(ii) in the case of a firm, an association of persons or a body of individuals, whether incorporated or not, and a company, immovable property held for the purpose of business of construction and sale or letting out, of property;"

Referring to paragraph (ii) as reproduced above, he argued that the wealth-tax was leviable on that immovable property which was held by a company for the purposes of the business of construction and sale, or letting out of property. Relying upon 1981 P T D 217, B.P. Biscuit Factory Ltd. v. Wealth Tax Officer and P L D 1985 Kar. 407, Ebrahim Brothers Ltd. v. Wealth Tax Officer the learned counsel argued that words 'held for the purposes of business of construction and sale' and term 'letting out' which find place in aforesaid para. (ii) were disjunctive.. The learned counsel further argued that a property in self-occupation cannot be said to be a property held for the business of letting out. Elaborating his arguments further the learned counsel also argued that the income derived by the appellant from godowns and shown in the profit and loss account was not an income from business of letting out of the immovable property. He submitted that the appellant was providing storage facility to the traders of the locality in "its godown at different rates varying from 15 paisa to Rs.4 depending upon the nature of the goods stored in the godown and the duration of the occupation of the space. In order to fortify his submissions, the learned counsel relied upon the following decisions:--

(1) P L D 1985 Kar. 407 Ebrahim Brothers v. W.T.O.

(2) 1981 P T D 217.

(3) 1986 P T D 592 (Trib.)

6. He further submitted that all the details were given to the assessing officer regarding all the tenants of the appellant as well as the parties to whom the storage facility was provided. Mr. Mohammad Farid, the learned DR, on the other hand, has supported the orders of both the officers below and argued that the amount received by the appellant in both the assessment years was rightly added to the Annual Letting Value because it was arising out of the immovable property held by the appellant for the purposes of the business of letting out.

7. We have given our careful consideration to the submissions of the learned counsel for the appellant as well as learned DR. Starting with the cases of B.P. Biscuit Factory and Ebrahim Brothers Ltd. (supra) we respectfully agree with their Lordships of Karachi High Court that use of comma and word "or" in section 2 (e) (ii) of the Wealth Tax Act strongly suggests two separate businesses of construction and sale and of letting out. Now turning to the main, argument, it appears to its that the answer to the question involved depends on the interpretation of the word "business of letting out or, to be more precise, on the interpretation of the word "let". Plain dictionary meaning of the word "let" is to grant use of for rent. In Parker v. Sowerby, 1 W.R. 404, the word "let" was taken to be equivalent to the word "lease". Thus; it could be safely concluded that the power of letting out means the power of giving a property on lease and the lease has been defined in Section 105 of the Transfer of Property Act. It reads:

"105. A lease of immovable, property is a transfer of a right to enjoy such property made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions- to the transferor by the transferee, who accepts the transfer on such terms.

The transferor is called the lessor, the transferee is called the lessee, the price is called the premium, and the money, share, service or other thing to be so rendered is called the rent."

From bare perusal of this definition it appears that a lease of immovable property is a transfer of right to enjoy such property but it should be to the exclusion of others. But if the submission of Mr. Sirajul Haque, that the appellant provided storage facility to the traders of the locality in its godown at different rates varying from 0.15 paisa to Rs.4 depending upon the nature of the goods stored in the godown and the duration and the occupation of the space, is taken into consideration then it would not be possible to say that the appellant was letting out its godown. If the appellant stores in its godown goods of a trader, he does not let out the property but on the contrary he becomes the bailee of such goods under section 148 of the Contract Act. It is as follows:-

"148. A "bailment" is the delivery -or goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the directions of the person delivering them. The person delivering the goods is called the "bailor". The person to whom they are delivered is called the "bailee".

Explanation . -- If a person already in possession of the goods of another contracts to hold them as a bailee, he thereby becomes the bailee, and the owner becomes the bailor, of such goods although they may not have been delivered by way of bailment."

If we peruse cases of B.P. Biscuit Factory and Ebrahim and Brothers Ltd. (supra) and if we compare both Sections 105 of the Transfer of Property Act and 148 of the Contract Act, we find that lease is a contract in which a right to enjoy an immovable property is transferred to the lessor to the exclusion of others, whereas in' bailment the goods are delivered by one person to another for some purpose. The former deals with immovable property but the latter deals with goods. In our judgment the facts as stated by Mr. Sirajul Haque, make out a case of bailment and not of lease. As such, we feel very much constrained to agree with the contention of the learned counsel for the appellant that the appellant did not hold self-occupied godowns for purposes of business of letting out. However, let us hastily add that the appellant was, in any case, carrying on business although it was not business of letting out. In (1963) 48-ITk-577, C.I.T. v. National Storage Private Limited a company with the object of carrying on business of preserving films and cinema accessories constructed a building of special vault for the purpose. Although these vaults remained in exclusive possession of the company but were given for use to film distributors. The question arose as to whether the income of the company should be assessed under section 9, 10 or 12 of the Indian Income-Tax Act. It was held that since the, company was in occupation of the premises for the purpose of its business which consisted of safe storage of films by providing use of the vaults and affording facilities for the safe storage of the films, the company, therefore, derived its income from business and not from letting out of the property. In our view this ruling lends support to our conclusion. Thus, neither the self-occupied godowns can bet held to be assets as defined by clause (ii) of section 2 (e) of the Wealth-tax Act nor Rs.24,339 and Rs.22,608 can be held to be income from business of letting out.

8. Now we turn to the issue regarding interest calculated at the rate of 12% on the amount of security deposits in both tie assessment years. From perusal of the assessment orders it appears that the W.T.O. not only disallowed the amount, of Rs.27,-10,780 and Rs.27,45,720 as liability in both the assessment years respectively,' but has also added to the Annual Letting Value the interest calculated at the rate of 12% on aforesaid amounts which came to Rs.3,29,486 and Rs.32,889 in assessment years 1979-80 and 1980-81 respectively. We shall be dealing with the issue of liability in the later part of this decision. However, as far as the addition of interest is concerned, it appears that the assessing officer has made the following observation:-

"The security deposits are not a liability within the competence of section 2(m). `It envisages only of the liabilities, which have ripened into debt owing. Since it had not yet ripened into debt as such cannot be allowed, moreover I shall charge interest on these deposits @ 12% per annum which comes to Rs.3,29,486 and add in the ALV."

The same observation was made in the subsequent assessment year with the only change of figures regarding the amount of interest. The learned AAC, however, ordered its deletion in both, the assessment years with the following observation:-

"This addition to the declared GARV in both the years, having been made on the basis of actual receipts, is, therefore upheld and the two appeals filed on this ground. So far as the addition of hypothetical interest is concerned, it has already been held by me vide my order No.AAC/F/284/80 dated 27/9/1980 that such hypothetical interest could not be regarded as 'actual rent' received by the appellant and, therefore, no enhancement of the GAR V could be made on this basis without the prior approval of the Central Board of Revenue."

9. Mr. Mohammad Farid, the learned DR, however, supporting the departmental appeals has contended before us that the assessing officer was right in adding interest, which he calculated on security deposits, to the ALV. In support of his submission the learned DR relied upon the following decisions:-

(1) 1983 P T D (Trib.) 327.

(2) 11 TC 573, Davies v. Abbot.

(3) W.T.A. No. 17/KB of 1981-82, dated 7/7/1985' (Trib.).

(4) (1967) 66 I T R 338 Jiwanlal Virmani v. C.W.T. (U.P.).

(5) W.T.A. No. 64/KB 1983-84, dated 16-3-1988 (Trib.).

(6) (1970) 111 I T R '272 C.W.T. (Kanpur) v. Lakhshmi Pan Singhania.

(7) P L D 1977 Lah. 292 Dreamland Cinema, Multan v. C.I.T

10. Mr. Sirajul Haque Memon, the learned counsel for the appellant, strenuously argued that the assessing officer had no legislative authority for adding interest worked out on amounts of deposits to the ALV in order to determine the value of the asset. The learned counsel cited before us the following authorities:-

(1) P L D 1976 SC 615 Lyallpur Cotton Mills Ltd. v. Commissioner, Sargodha Division.'

(2) P L D 1976 SC 618 East and West Steamship.

(3) P L D 1965 SC; 434 Pramathanath Chaudhry and 17 others v. Kamirmondal anal others.

(4) (1959) 36 I T ' R 1 C.I .T., Mysore v Indo Mercantile Bank Ltd .

11. We have heard) both the learned DR and the learned counsel for the appellant it length. Since the issue regarding addition of interest is reported to be involved in' several appeals, we are, therefore called upon, to dispose it of as a Full Bench so that controversy could be authoritatively set at rest. As such, we feel inclined to dwell upon at some length.

12, From perusal of the Wealth Tax Act and the Rules framed thereunder it appears that sub-rule (3) of Rule 8 of the Wealth Tax Rules lays down the mode of valuing lands and buildings for the purposes of Wealth Tax. It reads as under:-

"(3) Lands and buildings. -- The value of lands and buildings (excluding agricultural land) shall be estimated with due regard to the nature and size of the property, the amenities available and the price prevailing for similar property in the same locality or in the neighbourhood of the said locality-:

Provided that the Wealth Tax Officer shall not except with the prior approval of the (Central Board of Revenue) determine the value of any property at a sum higher than ten times the gross annual rental value of such property; and

Provided further that any amount by way of advance or security which is not adjustable against the rent payable by the tenant shall be taken into consideration for determining gross annual rental value

Explanation-- For the purpose of this sub-rule 'gross annual value' means the sum for which the property might reasonably be expected to let from year to year."

13. However, before we discuss the extent 'and scope of sub-rule (3) of Rule 8, let us mention at this juncture that the first proviso as reproduced above was substituted by SRO No.293 (1)/71, dated 29th July, 1971. Previously this proviso read as under:-

"Provided further that the capital value of such property has been so determined, the Wealth Tax Officer might not except,, with the prior approval of the Inspecting Assistant Commissioner of Wealth Tax, adopt a value higher than a sum equal to 110 times the gross annual rental value of such property."

Thus, from comparison of the text of the present first proviso with its earlier text it appears that previously the proviso applied wheel the value of the property had been determined whereas the present text of the first proviso lays down that the Wealth Tax Officer 'shall not determine the value'. We think that the legislature has made this, departure with some purpose. A Full Bench of this Tribunal in a,' case reported as (1987) P T D 52 (Trib.) dealing with Wealth Tax case regarding 'assessment years 1974-75 to 1977-78, had,; therefore, determined the .hope and extent of sub-rule (3) of Rule 8 in the, following words:-

"Sub-rule (3) of Rule 8 indicates as to what factors the Wealth Tax Officer has to keep in mind while framing his opinion shout the market value of a particular property. He has to keep into consideration the nature and size of the property the amenities available and the price prevailing for similar property in the same locality. From perusal of sub-rule (3) it further appears that the Wealth Tax Officer has been given another mode of estimating; the value of a particular property. This is by way of multiplying 10 time or more the Gross Annual Rental Value. If he wants to adopt this mode firstly he would have to find out as to what the property could reasonably be expected to yield as annual, rent."

14. Before elaborating our argument, further regarding sub-rule (3) and its first proviso let us also mention here that the second proviso to sub-rule (3) was inserted by Notification No.728 (1)/81, dated Ist July, 1981 as mentioned above. The legislature felt that the facility of advance rent or security deposits could be very much abused in some cases and aforesaid proviso was, therefore, introduced to meet the situation. Let 'is point out here that the ambit and fold of the expression 'Gross Annual Rental Value', as used in first and second proviso has not been very much extended as a W.T.O. has been directed only to keep into consideration the unadjustable advances or security deposits. We shall dilate or this point later on.

15. Reverting to earlier discussion let us point out that the expression 'Gross Annual Rental Value' has not been defined anywhere either by the Act or the Rules framed thereunder. The explanation appended to sub-rule (3) of Rule 8, therefore, was brought on Statute Book as a clarificatory piece of legislation. However, it may be noted that the expression, which has been used in both the provisos is 'Gross Annual Rental Value'. But in Explanation the expression used is 'Gross Annual Value. In our judgment this difference in expression is not of any significance for the simple reason that in the Explanation the expression 'the sum for which the property might reasonably be expected to let from year to year', fill in the gap and the expression 'Gross Annual Value' necessarily means and implies the Gross Annual Rental Value.

16. Now this expression has been used in various legislations in the Sub-continent of India and Pakistan. Section 127(A) of the Calcutta Municipal Act and section 82 (2) of the Madras District Municipal Act, as well as section 23 (1) of the Indian Income-tax Act are even considered by Indian Supreme Court in the case reported as A I R 1962 SC 153, The Corporation of Calcutta v Shrimati Padma Devi AIR 1971 SC 353, Gantur Municipal Council v. Gantur Rent Payers Association and (1981) 131) I T R 435 Mrs. Shiela Kaushit v. C.I.T. (Delhi).

17. In Padma Devi's case (supra) the Indian Supreme Court held that the correct criterion for determining the reasonable annual rent should be the rent realisable by the owner and not the notional value for which it could be let out. In case of Gantur (supra), the same view was reiterated. However, in case of Sheila (supra) the Indian Supreme Court reviewed the entire case-law in view of its two decisions reported as (1972) SCR 390. N.M. Chawla v. Sethi and (1980) 122 I T R 700 Diwan Dandant Rai Kapoor v. New Delhi Municipal Committee. In Kappor's case (supra) the question which came to the anvil of the highest Court of the land was as to how the annual value of- the building should be determined for levy of house-tax, where the building was governed by the provisions of the relevant rent laws and the standard rent was not yet fixed. It was held in, this case that the landlord could not reasonably be expected to receive from a hypothetical tenant anything more than the standard rent determinable under the relevant rent laws. It was further observed that the position would remain the same whether the building was given to a tenant on higher rent or its fair rent was not determined within the prescribed period. Relying upon this decision the Indian Supreme Court extended the same principle to the question of valuation arising under Income Tax Act as well. The main burden of all these decisions appears to be that the reasonable annual rent is that which is expected to be received notionally from a notional tenant and in a notional market and not the actual rent which is received in fact. Their Lordships of Indian Supreme Court in Kapoor's ease (supra) have enunciated this principle in the following words at page 701:-

"The rent control legislation provides for fixation of standard rent, which alone and nothing more than which the tenant shall be liable to pay to the landlord. It does so because it considers measure of the standard prescribed by it to be reasonable. It lays down the norms of reasonableness in regard to the rent payable by the tenant to the landlord. Any rent which exceeds this norm of reasonableness is regarded by the legislature as unreasonable or, excessive. The legislature obviously records recover, of rent in excess of the standard rent as exploitation of the tenants and would it be proper for the Court to say that it would be reasonable on the part of the landlord to expect to recover subject to exploitative rent from the tenant."

With due respect, we think that the above observation of their Lordships of Indian Supreme Court clinches the issue before us. What is reasonable or what is not reasonable has been laid down by the legislature itself, as far as the determination of gross annual rental value is concerned, for the purposes of estinwanr1g the value of the building under sub-rule (3) of Rule 8 of the Wealth Tax Rules. Accordingly gross annual rental value of a building for which it could reasonable be expected to be let out from year to year is that which is determined keeping into consideration:-

(1) the nature anal size of the property,

(2) the amenities available, and

(3) the amount of advance or security deposit which is not adjustable against the rent paid by a tenant.

As observed by their Lordship of Indian Supreme Court any gross annual rental value which would exceed this norm of reasonableness would be regarded by the legislature as unreasonable or excessive. It would be pertinent to reproduce the observation of Lord Buckmaster made in the case of F.L. Smith and Company v. F. Greenwood Coated which is reported as 8 TC 193. His Lordship stated the law as follows:-

"It is, I think, important to remember the rule, which the Court ought to obey that, where it is desired to impose a new burden by way of taxation, it is essential, that this intention should be stated in plain terms. The Courts cannot assent to y the view that if a section in a taxing statute is of doubtful and ambiguous meaning, it is possible out of that ambiguity to extract a new and added obligation not formerly cast upon the tax-payer."

Thus, if the assessing officer is allowed to raise the value of an asset by adding to its GARV the amount of interest calculated on the mount of unadjustable deposits or rent in order to work out the Wealth-tax liability it would amount to "extracting a new and added IN obligation not formerly cast upon the tax-payer" hence would not be sustainable in law. In our judgment, therefore, the learned A.A.C. rightly ordered deletion of the interest in both the assessment years.

18. However, before we part with this issue let us also deal with the case-law cited at Bar. Mr. Mohammad Farid, the learned D.R., heavily relied upon a decision of this Tribunal reported as 1983 PTD (Trib.) 327. From its perusal it appears that in this case the W.T.O. had added interest amounting to Rs.45,180 worked out at the rate of 12% on amount of deposits/ advance rent amounting to Rs.3,76,500 to the declared GALV of the properties amounting to Rs.34,320 involved in asstt. year 1979-80 in order to work out the market value thereof for the purposes of levying wealth-tax. It further appears that it was contended before the learned Bench that the law nowhere contemplated the addition of interest etc., on security deposits obtained from the tenants and that in absence of such specific provision no addition could legally be made. Alternatively it was argued that 125 rate was excessive because the bank rate prevailing was only 10%. The learned Division Bench has dealt with this argument regarding addition of the interest in the following words:-

"It is a matter of common knowledge that in some cases the landlords collect substantial amounts by way of deposits and let out the properties on very low rates because the loss in rent is more than made up from the income which could be obtained from the deposits. The W.T.O. had, in fact, to determine a GALV and for that purpose besides the location, size etc., he could take into consideration other factors also to determine the Annual Letting Value. In our opinion, the fact of obtaining security deposit was a relevant factor which could also be considered for determining the GARV of the property because the deposit made by the tenant in addition to the agreed rent does continue to yield an extra benefit to the landlord over and above the amount of rent received."

However, the learned Members were pleased to reduce the rate of interest from 12% to 10% with the following observation:-

"In this view of the matter, we hold that the addition made by the Wealth Tax Officer on account of security deposit, was justified but as stated by the learned counsel that the bank rate was 10% which was not disputed before us, we direct that the amounts should be calculated @ 10% in spite of 12%."

It is thus clear that the learned Members did not give any reason whatsoever for the addition of interest as that was the point in issue before them. In fact from the passage reproduced above it appears as if the learned Members felt convinced that the sum of deposits/ advance rent was not adjustable. Since no reason has been given for justifying the addition of interest, we, with due respect, feel very much constrained to observe that aforesaid decision is not an authority for the proposition that an assessing officer would be justified in making addition of interest @ 10% worked out on deposits/advance rent. The reliance of the learned D.R. on this decision, therefore, appears to be wholly misplaced. Let us also point out that as far as the issue regarding addition of deposit/advance rent to the GALV is concerned, we again feel constrained to observe with due respect that aforesaid decision cannot be held to be an authority even for that purpose for the simple reason that the, issue involved was regarding the addition of interest and not addition of deposit or advance. The observation reproduced above, therefore, appears to be nothing but obiter dicta.

19. The next case relied upon by Mr. Mohammad Farid is Davis',s case (supra). However, it revolves round its own facts. In this case a property was given on lease on 10th June, 1919 for 14 years on annual rent of L. 30 but subject to payment of premium of E.2on which was not in any case refundable. In 1921 the original tenant assigned his unexpired term of lease in consideration of the premium of ;.900. A dispute arose about the annual value of the premises. The General Commissioners took into consideration the premium originally paid for the lease plus interest thereon while determining the annual value. Since the interest was calculated on the amount of premium originally paid and was added .to the annual value, the learned DR argued before us as to why the interest could not be added in Pakistan. But, with due respect, we think that Davis's case was not applicable in Pakistan. In that case the British Court of Appeal was required to interprete Rule 9 which lays down that a lease was to be assigned to a tenant for any consideration in money for value paid or agreed to be paid. Firstly the words 'consideration' and 'value paid, which were used in Rule 9 are of wider connotation and may include interest calculated on amount of premium. But in Pakistan the expression used is 'reasonably let out from year to year', the true import and significance of which has been discussed by us at some length in the earlier part of our decision. Secondly in all the lease agreements in the appeals before us advance rent/deposits was said to be refundable as a contingent liability or otherwise and was even allegedly refunded in some cases whereas the premium paid in Davis's case (supra) was, in any case, non-refundable. This case, therefore, also does not help the learned D.R.

20. As far as the unreported decision of this Tribunal recorded" in W.T.A. No. 17/KB of 1981-82 is concerned which is relied upon by the learned DR for the proposition that addition of second proviso was clarificatory hence could be applied retrospectively. However, with due respect to learned DR, we do not think that it helps him at all. The relevant portion of this order reads as under:-

"Notification No. SRO 728 (1)/81, dated 1st July, 1981, appear., to have been issued to clarify the position and it does not bring anything new to the already existing principles for the valuation of the properties available in Rule 8(3) of the Wealth Tax Rules. In any case this notification is not material in this case because the rent charge was evident from the agreement."

It is thus clear that the proposition relied upon by the learned DR was not laid down in this case as the issue was not found to be material. The observation of the learned Bench that second Proviso simply clarified the position which was already existing appears to be again obiter dicta as it was not necessary for disposal of that appeal as has been pointed out in the later part of the passage reproduced above.

21. Now as far as the Virmani's case (supra) is concerned, it also appears to be irrelevant. It deals with the question as to whether on the facts and circumstances of the case a loan raised on security of Life Insurance Policies was to be deducted in arriving at the net wealth though the same was used in acquiring taxable assets. The decision of this Tribunal recorded in WTA No.64/KB of 1983-84 also deals with the same issue.

22. Let us now turn to the next issue, which has been seriously canvassed before us. It is regarding the IInd Proviso added on 1st July, 1981. Since the assessment year involved before us are assessment years 1979-80 and 1980-81 the question arises as to whether the IInd Proviso applied to them or not. Mr. Mohammad Farid, the learned DR, has answered this question in the affirmative., According to him since IInd Proviso is clarificatory in nature, it would, therefore, apply retrospectively. The learned DR firstly relied upon a case from Sind High Court at Karachi reported as P L D 1985 Kar.407 Ibrahim Brothers Ltd., Karachi v. W.T.O. .In this case the assessment years involved were 1979-80 to 1982-83 and the point which came up before their Lordships was as to whether paragraph (ii) of Clause (e) of Section 2 of the Wealth Tax Act would apply in all the relevant assessment years. This question arose because the date of amendment printed in the Gazette was 28th June, 1980. However, when the Statute Book was examined it was found that actually it was signed by the President and the Law Secretary on 28th June, 1979. Thus, the question of' retrospective operation of the amendment was not involved in this case. It is, therefore, not relevant for our purposes. Mr. Mohammad Farid, the learned DR, also relied upon a case of Indian Supreme Court reported as (1965) 57 I T R 149, S.A.L. Naraiyan Rao and another v. Ishwarlal Bhagwandas and another. We have gone through this case as well. It appears that Act 25 of 1953 was given retrospective operation from 1st April, 1952 though the rules thereunder were framed in December, 1953. This case, therefore, is also not applicable. However, Mr. Mohammad Farid has also relied upon a case from Calcutta High Court which is reported as (1977) 106 I T R 743, C.I.T. West Bengal v: Vejoy Kumar Almal. In this case a provision was enacted for the express purposes of explaining or clearing up issue ash to the meaning of a previous enactment regarding computing -the share of co-owners. It was, therefore, held that the Explanation to Section 26 enacted subsequently was retrospective in operation. This case appears to be relevant for our purposes and we shall revert to it subsequently. The next case cited at Bar by Mr. Mohammad Farid is from Lahore High Court and is reported as P L D 1977 Lah. 292, Dream Land Cinema, Multan v. C.I.T. In this case also an explanation was added to section 24 (2) of the repealed Income Tax Act and it was held that it was retrospective in operation. This case, therefore, also appears to be irrelevant for our purposes as an explanation is generally clarificatory in nature. On the other hand, Mr. Sirajul Haque, the learned counsel for the appellant, has relied upon P L D 1965 SC 434, Premthanath Chaudhry and 17 others v. Kamir Mondas and others. In this case their Lordships of our own Supreme Court have held that a Proviso, as is generally accepted, is in the nature of an exception to the substantive provision to which it is appended. With due respect we agree with this observation. The next case relied upon by Mr. Sirajul Haque is reported as (1959) 36 I T R 1, C.I.T. (Mysore) v. Indo Mercantile Bank. In this case their Lordships of Indian Supreme Court while explaining the function of a Proviso observed at page 7 as under:-

"The proper function of a Proviso is that it qualifies the generality of the main enactment by providing an exception and taking out as it were, from the main enactment a portion of which, but for the proviso would fall within the main enactment. Ordinarily, it is foreign to the proper function of the proviso to read it as providing something by way of a" addendum or dealing with the subject which is foreign to main enactment. It is a fundamental rule of construction that the proviso must be considered with relation to principal matter to which it stands as a proviso."

We also respectfully agree with this exposition of law as well. However, let us point out that in spite of generality of this principle of interpretation we have also to keep into consideration various other principles of interpretation also. Thus, we cannot lose sight of the principle that with reference to the context and the intent and purpose of a legislation, be it even a proviso, we should interpret it in such a way that it fits in the general pattern of the legislation rather than to render it absurd and otiose. Thus, the matter does not end here. We would have to revert to sub-rule (3) of Rule 8 in order to determine the real nature of the proviso.

23. As we have held earlier, sub-rule (3) of Rule 8 deals with various modes of working out the market value of a land or building, and since one of the recognised modes is of obtaining it by multiplying the Gross Annual Rental Value 10 times or more, the first proviso has, therefore, merely put an embargo on the power of Wealth Tax Officer when it laid down that if he wanted to determine the value of any property at a sum higher than 10 times the gross annual rental value, he should seek approval of the C.B.R. or I.A.C. It, therefore, necessarily means that the W.T.O. has the power of obtaining market value by multiplying GARV 10 times or more. Had he not been enjoying such power there would not have arisen any occasion for imposing a condition of approval. Thus, main sub-rule (3) lays down the general power of the W.T.O. and the proviso puts a restriction thereon.

24. Now if the IInd proviso is read with 1st proviso it appears that it has been added as an explanation to the general power of the W.T.O. given to him under sub-rule (3) that when a W.T.O. wants to work out the market value of a property on the basis of its gross annual rental value, he shall take into consideration the amount of advance or security which is not adjustable against the rent. Thus, we find force in submission of Mr. Mohammad Farid, the learned DR, that the W.T.O. always had that power as he had to keep into consideration various factors which enable him to find out the sum for which a property might reasonably be expected to let from year to year as we have discussed in some length earlier. Consequently, we agree with him that this proviso is simply explanatory in nature hence is retrospective in operation and applies with full force in assessment years involved before. However, let us reiterate once again that this proviso does not vest the W.T.O. with the power of adding necessarily 10% or 12% of the deposit/advance rent or interest calculated thereon to annual letting value in order to find out gross annual rental value. Since the deposits or advance rent may be o different nature and for various purposes, which we shall be discussing in the later part of our decision the legislature did not lay down any formula. It simply recommended though mandatorily to a W.T.O. that he must take into consideration the amount of advance rent or security deposits while determining the gross annual rental value because in some cases the actual rent received may be lesser than the reasonable rent due to payment of advance rent or security deposits.

25. The question now arises as to what course of action could bet adopted by a W. T.O. if he finds that the actual rent received is lesser than the reasonable rent because of the payment of adjustable advance rent or security deposits? Mr. Mohammad Farid, the learned DR, has suggested that by adding 10% of the advance rent or security deposits to the annual rent the reasonable annual rent could easily be achieved. But, with due respect, we are not prepared to concede such a power to W.T.O. without legislative authority. We, therefore think that keeping into consideration the size, amenities available and the locality, the reasonable rent could be ascertained from parallel cases. Mr. Mohammad Farid, the learned DR, however, asked us as to why the legislature enacted second proviso if parallel cases were to be the criterion for determining the reasonable rent. Our answer to this question, however, is that the main reason for bringing second proviso on Statute Book appears to be that since there could possibly be various kinds of deposits/advance rent with different intentions and for various purposes as discussed by us in the later part of our decision, the legislature directed the W.T.O. through second proviso to take them into consideration and fall back upon parallel cases if he found that the actual rent received was lesser than the reasonable rent but not otherwise. Had it been there intention of the legislature to vest the W.T.O. with the power of adding interest calculated on the amount of unadjustable deposits/ advance rents or 10% thereof, it could have laid down simple formula of making such addition. In our T judgment the direction to the W.T.O. to keep into consideration the amount of unadjustable deposits or advance rent merely clarifies the power of the W.T.O. qua those cases in which the actual rent received was lesser than the reasonable rent. In such cases the W.T.O. could have or could not have taken the amount of security deposits or advance rent into consideration while finding out reasonable rent. But by introducing 2nd proviso the legislature has clarified to the W.T.O. that in such cases he is left with no option but to take such unadjustable security deposits or advance rents into consideration. Let us mention here that the legislature introduced subsection (13) of section 12 of the Income Tax Ordinance when in its wisdom the legislature thought fit to bring to tax the amount of security deposits or advance rent which was not adjustable against the rent payable by spreading it over 10 years including the income year in which such amount is paid. We feel that the legislature would introduce such type of provision in the Wealth-tax Act or the Rules framed thereunder also when, in its, wisdom, it feels that the W.T.O. must add to the wealth of an assessee the amount of unadjustable security deposits or advance rent. Till such legislation is introduced, we should follow the law as it is.

26. Thus, the upshot of all this discussion appears to be that whenever a W.T.O. has to determine the market value of any property he must--

(1) find out the gross annual letting value of a property as discussed above on the basis of actual rent received, and

(2) take into consideration the amount of unadjustable security deposits /advance rent; and

(3) determine its nature and intent and purpose, and if the actual rent received is found to be on lower side because of the payment of security deposits or advance rent which was not adjustable, he should look for parallel cases to find out the reasonable rent, and

(4) multiply the annual reasonable rent 10 times or more, of course, with the prior approval of C.B.R. or I.A.C. as the case may be.

27. Before concluding our discussion on this issue we should once again refer to a decision of this Tribunal cited as 1.983 P T D (Trib.) 327 which has been relied upon by Mr. Mohammad Farid, the learned D.R. and once again express our view that it does not lay down the correct law and should not, therefore, be followed. This takes us to the last issue involved in the matter.

28. Now we turn to the next important issue involved in cross- appeals. It is regarding nature of deposits/advance rent. Mr. Mohammad Farid, the learned D. R., has vehemently argued that the amount of deposit/advance rent could not be called 'debt owed' for the purposes of working out net wealth under section 2(m) of the Wealth Tax Act a In order to fortify his contention the learned D.R. has relied upon `the following cases:-

(1) (1975) 32 Tax 1, CWT (Lahore) v. Mst. Fozia Mughis (Lah. HC).

(2) (1963) 48 I 11 R 31, Kesoram Cotton Mills Ltd. v. C.W.T. (Cal. HC).

(3) (1967) 63 I T R 470 Standard Mills Co. v. C.W.T., Bombay (Ind. SC).

(4) (1976) 107 I T R 400 C.W.T. v. Abdul Hussain Mullah Mohammad Ali (M.P. HC).

(5) (1966) 58 I T R 767 Kesoram Industries & Cotton Mills Ltd. v. C.W.T. (Ind. SC).

(6) (1964) 54 I T R 337 C.W.T. (Kerala) v. Fertilizer Chemicals (Travancore Ltd.)

(Ken. H.C.).

(7) W. T. A. No. 1 to 10/PB of 1980-81 dated 26th December, 1983.

(8) W. T. A. No. 16/KB of 1981-82, dated 28-10-1985.

(9) W. T. A. No. 28/113 of 1986-87, dated 6-3-1988.

27. Mr. Sirajul Haque, the learned counsel for the appellant, on the other hand, has vehemently argued that not only deposits/ advance rent was a liability in these appeals but the learned A.A.C. should have also allowed the amount of bank loans as liability while working out the net wealth of the appellant. The learned counsel also relied upon the cases of Fozia Mughis and Kesoram Industries (supra) which have also been relied upon by Mr. Mohammad Farid, the learned D. R. Moreover, he has also relied upon a case from Allahabad High Court reported as (1982) 136 I T R 499 C.W.T. Allahabad v. Dinanath.

"

28. We have heard both the learned D.R. as well as the learned counsel for the appellant at length and have also perused the case-law cited at Bar. Let us, however, start our discussion with the definition of net wealth as contained in clause (m) of section 2 of the Wealth Tax Act as under:-

(m) 'net wealth' means the amount by which the aggregate value computed in accordance with the provisions of this Act of all the assets, wherever located belonging to the assessee on the valuation date including assets required to .be included in his net wealth as on that date under this Act, is in excess of aggregate value of all the debts owned by the assessee on the valuation date other than----

(i) debts which under section 6 are not to be taken into account; and

(ii) debts which are secured on, or which have been incurred in relation to any asset in respect of which wealth tax is not payable under this Act;

Explanation -- For the purposes of this clause,-

(i) any immovable property, other than agricultural land, owned by the spouse or any (minor) child of the assessee shall be deemed to belong to the assessee.

Provided that any immovable property so deemed to belong to the assessee shall not be included in the net wealth of the spouse or (minor) child of the assessee;

(ii) 'assessee' shall be the spouse determined by the Wealth Tax Officer; and

(iii) where the right, title or interest to or in any immovable property other than agricultural land vests in more than one person, such person, shall, in respect of such property, be assessed as an association of persons and the value of such right, title or interest shall not 'be included in the net wealth of an individual (provided wealth-tax is charged on such right, title or interest).

It appears from its perusal that the Wealth Tax Officer, while computing

4 the wealth tax, has firstly to find out the net wealth and in order to arrive at it has to deduct all the 'debts owed' from the aggregate value of all the assets held by an assessee on valuation date. In appeals before us, however, the amounts involved are said to be the advance rent/deposits received from the tenants and the loans allegedly obtained from barks and directors. It is contended by the appellant, that all these deposits/ advance rent were used for the construction of the building which is subject-matter of the wealth tax and were refundable. Mr. Muhammad Farid, the learned D.R., however, has contended that they were neither used for construction of the building nor were refundable. According to him the appellant held them in perpetuity hence they did not amount to all the 'debts owed' so as to be deducted from the aggregate value of all assets. We, therefore, propose to start our discussion with examining the issue regarding the concept of 'debt owed'.

29. After thoroughly examining all the case-law and closely analysing the issue involved, we wish to sum up our conclusion in our own words as follows:

(i) Every loan is always a debt but every debt is not always a loan.

(ii) Generally speaking the relationship of loaner and loanee is always creation of conscious and deliberate action whereas the relationship of debtor and creditor generally substitutes some other relationship. For example, if a person asks for some money from 'B' to be paid back after some time and if 'B' pays it to 'A', the passing of the money shall be called giving of a loan and the relationship of a loaner and the loanee would come into existence. But suppose a person gives some money to an importer of goods as advance payment of cost but the latter fails to supply the goods for any reason, the amount payable would amount to a 'debt'. Similarly unadjusted advance rent given to a landlord by a tenant would be a debt payable by the former if he ejects the latter and recoverable by the latter if he quits the hired property.

(iii) In case of loan a loanee has generally a right to appropriate the amount .of loan immediately but in the case of a debt the debtor has no right in law to appropriate it though the amount of debt may be reflected in his books and lying in his till

(iv) Every loan or debt is a liability to be discharged in praesenti or in futuro and is either ascertained or ascertainable but it should always be real and not be either illusory or remote, or imaginary or false.

(v) The expression 'all the debts owed' does not mean and imply 'all the debts due' or 'all the debts payable'.

(vi) That the expression 'all the debts owed' means all types of debts whatever be their nature.

(vii) All the debts are to be ascertained from assessee's point of view and not from the point of view of the creditor for the simple reason that the net wealth of the assessee is to be worked out and the question regarding the right of the creditor to recover it should not be generally considered. The interpretation of the expression 'all the debts owed', therefore, should be liberal.

(viii) All the debts should be owed on valuation date.

(ix) In view of Dina Nath's case (supra) the words 'debt' end 'liability' are synonymous with each other.

30 Let us now also examine the nature of deposits/ advance rent. They may fall in any of the following categories:-

(i) The deposits/ advance rent may be taken by a landlord for investing them in building a new property and such deposits/ advance rent are made adjustable against the rent.

(ii) The deposits/ advance rent may be received by a landlord as caution money for indemnifying himself for the damages caused to fixtures and fittings by the tenant.

(iii) Deposits /advance rent may be obtained by a landlord for enforcing the performance of a contract, e.g., it may be agreed upon that a licensee or a lessee would vacate the property after certain period failing which the landlord would charge mesne profits at certain rate and deduct the same from deposits/ advance rent in addition to taking resort to other remedies open to him.

(iv) The deposits/advance rent may be obtained by a landlord for reducing the reasonable rent.

31. It is thus clear that the deposits /advance rent falling under categories 1, 2 and 3 would amount to 'debt owed' as they reflect the liability of a landlord which is real and which is to be discharged in praesenti or in futuro, whereas the amounts received under category 4 would amount to an illusory and false liability. In such cases the deposits /advance rent are held by the landlords in perpetuity with them in consideration of a rent which is on lower side than the reasonable rent. As such, such liability is not in fact a liability hence cannot amount to be 'debt owed'. '

32. Let us mention here that it is because of aforesaid four categories of deposits /advance rent that the second proviso added to sub-rule (3) of Rule 8 simply empowers a W. T.O. to keep into consideration the 'amount of such deposits/ advance rent while determining the gross annual rental value and does not direct him to add the entire or some amount of deposits/ advance rent to work out the gross annual rental value.

33. Now before summing up let us also briefly refer to the cases relied upon by the learned D.R. as well as the learned counsel for the appellant. The cases of Mst. Fozia and Kesoram (supra) refer to Income-tax liability and both the Lahore High Court and Indian Supreme Court have held that the income-tax liability amounts to debt owed. It is held that it arises the moment taxable income is earned though it may be payable subsequently in accordance with the Finance Act. However, we should keep in mind that an assessee in such cases has no right to appropriate the amount of his tax liability for any other purpose. It is, therefore, 'debt owed'. In Standard Mill's case (supra) their Lordships of Indian Supreme Court have held that gratuity payable on termination of employment was a mere contingent liability, which arose only when the employment of the employee was determined by death or other incapacity, retirement or resignation. Their Lordships were of the view that it was not a liability existing in praesenti hence could not be treated as 'debt'. In case of Abdullah Hussain Mullah (supra) it was held that Qarz-e-Hasna was not a debt as a debtor was not under an obligation to pay it back. Vow as far as the case of Fertilizer and Chemicals (supra) is concerned, it .was held in this case that under section 2(m) of the Indian Wealth Tax Act, the net wealth was to be calculated for the purposes of levying wealth tax after excluding liabilities which were liabilities Deditum in Praesenti though they might have been payable either immediately or in future. Now as far as the unreported decisions of this Tribunal are concerned it appears that the first decision recorded in W.T.A. No.1 to 10/PB of 1980-81 dated 26th September, 1983 has dealt with the issue under discussion rather summarily and without giving any reason or discussing any authority. It, therefore, offers no help to us. As far as the other decision recorded in W.T.A. No. 16/KB of 1981-82 is concerned, it deals with the case of 4th category of deposits or advance rent where such amount is received in consideration of reduced rent. We have already discussed this aspect of the matter. As far as the other decision recorded in W . T . A . No.28/ I B of 1986-87 dated 6th March, 1988 is concerned, it appears that in that case the assessee borrowed loan for construction of a building not only from a commercial bank but also from the prospective tenant called 'National Development Finance Corporation', hereinafter referred to as the N.D.F.C. though it was called advance rent after executing promissory note and creating equitable mortgage. The loan obtained from N.D.F.C. was to be adjusted against the rent which was agreed upon. The building was constructed and let out to N.D.F.C. and the adjustment of loan started against the rent of the building. On valuation dat''6 some amount of loan payable to the commercial bank and some amount of loan payable to N.D.F.C. was claimed as liability. A Division Bench of this Tribunal has upheld the claim regarding loan payable to the bank but disallowed the liability regarding loan advanced by N.D.F.C. From perusal of this decision it appears that the matter was not properly presented before the Bench. It, therefore, appears to us that this decision. is not laying down the correct law for the following reasons:-----

(1) That the amount given by N.D.F.C. to the assessee for construction of the building was nothing but a loan as it was secured not only by promissory note but also by equitable mortgage, though it was called advance rent.

(2) That the entire amount was used in raising the asset and it was to be adjusted against the rent to be paid by N.D.F.C. Thus, on valuation date the entire asset did not belong to the assessee though clause (m) of subsection (2) of the Wealth Tax Act laid down that it must belong to him on the valuation date before net wealth is worked out. In this case only that portion of the asset belonged to him which fell in his ownership after the adjustment of the rent on the valuation date.

(3) That if it is held that the entire asset belonged to the assessee it must be held that it was subject to the liability of that rent which remained unadjusted on the valuation date.

(4) That the N.D.F.C., on valuation date, has existing charge on the asset to secure the unadjusted amount of loan or advance rent.

(5) That if the assessee ejects he would have to' pay unadjusted amount of loan to N.D.F.C. and if N.D.F.C.- quits it would receive the same. Thus, the unadjusted rent is to be treated as a loan.

(6) That the difference between the debt owed by the assessee to the commercial bank and N . D. F . C . was only to be extent that in case of bank he had to pay money whereas in Case of N . D. F . C . , the payment was by way of allowing use and occupation of the building to N . D . F . C . In . either case the loan was to be discharged hence it was a liability.

(7) That the issue of the debt owed was wrongly argued from the angle of its recoverability by N.D.F.C. whereas it should have been considered from the angle of the assessee as, after all, his net wealth was to be worked out after deduction of all the debts owed.

(8) That the issue of debt owed was wrongly canvassed from the point of view of advance rent whereas it was essentially loan which has created asset itself.

(9) That as laid down by Allahabad High Court in the case of Dina Nath (supra) which is relied upon by Mr. Sirajul Haque the word 'debt' as used in clause (m) to section 2 of the Wealth Tax Act was synonymous with the word 'liability'. The learned D.R. erred in making distinction between the two.

34. Thus, it is clear that aforesaid decision has not dealt with the issue satisfactorily and adequately for the simple reason that no proper assistance was extended from the Bar. We strongly feel the it was all the more necessary for Mr. Mohammad Farid, the learned D. R., to place all the relevant case-law before the learned Bench the assessee was unrepresented. We also think that if all the relevant law would have been properly brought to the notice of the learned Bench, the issue might have been decided differently. Moreover, also appears to us that the attention of the learned Bench was no invited to a letter of C. B. R., dated 6-1-1980 tearing C.No.80(11)/WT6/79 wherein the following observation has been made:

"It is confirmed that the liability incurred by an assessee for the, acquisition /construction of a immovable property would be allowed as deduction from the gross value of this property while calculating the net wealth of an assessee."

35. Now reverting to the merits of the cross-appeals on the issue of debt owed, it appears that the W.T.O. has neither examined the points involved in these appeals in the light of the case-law discussed above nor has considered the true import and significance of aforesaid letter of C.B.R. The W.T.O. has also not examined the issue from the angle of the paid-up capital of the appellant which was alleged be Rs.4,50,000 whereas a huge amount stood invested in the building. The W.T.O. indeed, was expected to examine this issue in details the appellants had specifically pleaded before him that they not only borrowed the loans from the banks but also obtained it from the directors and used them alongwith the deposits/ advance rent construction of the building and the same was reflected in the balance-sheet of the relevant assessment years. We, therefore, all of the view that justice has not been done either with the appellant or with the department in this case. We are, therefore, left with no alternative but to set aside the impugned order and send the matter back to the Wealth Tax Officer.

36. Thus, to conclude we hold that for the reasons given above the W.T.O. was not justified in adding Rs.24,339 and Rs.22,608 the annual letting value of the property. We further hold for the reasons given above that the W.T.O. was not justified in adding interest worked out on the amount of deposit/advance rent to the annual letting value in both the assessment years. The order learned A . A . C . on first issue is, therefore, hereby vacated as indicated above but his order regarding the deletion of interest is hereby confirmed for both the assessment years. However, as far as issue regarding the liabilities, as raised by both the appellant at the department in cross-appeals is concerned, it is hereby set aside and the W. T.O. is directed to re-examine the entire issue in the light of discussion made above and frame de novo assessments in both the assessment years according to taw. Needless to say that both the appellant as well as the W.T.O. would have right to produce or summon such further and additional evidence which they deem fit.

37. All the cross appeals stand disposed of as indicated above.

M.B.A./521/T Order accordingly.