1. In these appeals by the assessee, which arc directed against the order of the AAC, the common issue is whether the assessee is entitled to exemption under Section 5(1)(iv) of the Wealth-tax Act, 1957 ('the Act'), in respect of property at No. 28-D, Mettu Street, Madras. The assessee is a co-owner to the extent of 10 per cent. He claimed exemption in respect of this property but the WTO denied exemption on the ground that he was only a co-owner and, therefore, his share of interest in the property was assessed at Rs. 40,000 each for the assessment years 1978-79 and 1979-80.
2. Before the AAC it was contended by the assessee that the expression 'house' could be defined as any building used for any purpose, i.e., either for residence or for commercial use or storage of articles, and even the Board's letter in F. No. 317/23/73-WT dated 29-7-1983 clarified that the exemption under Section 5(1)(iv) was to be given irrespective of whether the house is used for the assessee's own residence or let out on rent either for residential purposes or for commercial purposes. The AAC found the property in question was a business premise being godown which is co-owned by the assessee along with others and the income from the property was being assessed as business income in the hands of the AOP. According to him the exemption applied to house whether used for own residence or let out for residential purposes or commercial purposes and a factory building or a godown could not be considered as a house as they constituted separate category of assets other than house. Even the amendment to Section 5(1)(iv) made by the Finance (No. 2) Act, 1971 with effect from 1-4-1972 could not cover the property such as godown for the purpose of exemption under Section 5(1)(iv). Consequently, he dismissed the appeals filed by the assessee. , 3. Before us the learned representative of the assessee reiterated the grounds taken by the assessee. The main contention of the assessee was that the word 'house' means and includes any building used for any purpose, viz., residence, commerce, storage. The Board's circular clarified that the house could be used also for commercial purposes.
The legislative intention of the Parliament by removing the phrase 'exclusively used by him for residential purposes' was to provide exemption to all kinds of properties either used for residence or commercial purposes. The words 'commercial purpose' are wide enough to include in its scope all activities concerned with the commerce, viz., an office, a shop, sales depot, factory, godown or storage, etc.
Therefore, all buildings that are intended for ancillary and incidental activities connected with commerce are covered within the same expresion 'house'. At the time of hearing reliance was placed on the dictionary meaning of the word 'house'. He has also filed a copy of the order of the Tribunal Madras Bench 'A' in the case of Baba Estates [IT Appeal No. 1142 (Mad.) of 1981 dated 31-8-1982] an AOP in which the assessee is a member. In that case the AOP obtained the land situated at 28-D, Mettu Street, Madras, on sub-lease, put up godowns thereon and let out to the Tamil Nadu Civil Supplies Corporation. The question was whether the income therefrom was assessable under the heads 'Income from house property' or 'Profits and gains of business or profession'.
While the ITO held that it was an organised activity and, therefore, the income should be assessed under the head 'Profits and gains of business or profession', the Commissioner (Appeals) held that the income should be assessed under the head 'Income from house property' and as the shares of the co-owners were definite and ascertainable, Section 26 of the Income-tax Act, 1961 ('the 1961 Act') should be applied. This view has been upheld by the Tribunal and it dismissed the appeal filed by the revenue. Thus the Tribunal has decided that the rental income from the godown is assessable under the head 'Income from house property' and not 'Profits and gains of business or profession'.
On the strength of this decision of the Tribunal the assessee's counsel contended that the exemption under Section 5(1)(iv) should be extended under the Act.
4. The learned departmental representative on the other hand submitted that the order of the Tribunal pertained to Income-tax where the criterion is different, viz., income from property consisting of buildings or buildings and lands appurtenant thereto. According to him, the Tribunal in the aforesaid order found that the building is nothing but godown constructed by the AOP on land obtained on sub-lease. When once the nature of the building is found as godown it is not eligible for exemption under Section 5(1)(;v). In this connection he referred to the decision of the Orissa High Court in the case of CWT v. K.B.Pradhan  130 ITR 393, wherein it has been emphasised that the concept of habitability is inherent in the word 'house'. In reply the counsel for the assessee relied on the dictionary meaning of the word 'house'.
5. We have duly considered the rival contentions and the record before us. At the outset it is to be observed that the concept of 'property' is widest and most general under the Transfer of Property Act, 1882 but restricted to property consisting of building or buildings and land appurtenant thereto in the 1961 Act. Under the Estate Duty Act, 1953 ('the 1953 Act') 'property' includes any interest in movable or immovable property, the sale proceeds thereof and money or investment representing such sale proceeds and also includes any property converted from one species into another by any method. Under the Act, the definition of the word 'property' is the same as given in the 1953 Act. However, only in Section 5(1) of the 1957 Act specific exemption is provided under Clause (iv) to one house or part of a house belonging to the assessee. The Finance (No. 2) Act, extended the scope of exemption by altogether excluding the disputed requirement about the house being used exclusively for residential purposes and thus with effect from 1-4-1972 the exemption is available for a house or a part of a house of the value of Rs. 1 lakh whether residential or not.
Although the purpose for which the house is used is unspecified and evidently enlarged nonetheless the word 'house' or 'part of a house' belonging to the assessee is still retained. In the case of the assessee the land does not belong to the assessee or the AOP but there is leasehold interest therein and thus constitutes property. The godown constructed on the leasehold land can be said to belong to the AOP or members severally. There is no dispute to this extent. The Tribunal found that the AOP has constructed only godowns which were exploited by the Tamil Nadu Civil Supplies Corporation for storing food-grains. The Tribunal held that the income therefrom was assessable under the head 'Income from house property' and there is no quarrel over such decision. The essence of dispute is whether any building or structure is house or not. While every house is a building, every building is not a house. The word 'house' has not been statutorily defined and, therefore, recourse is to be taken to the meaning in common parlance.
The Concise Oxford Dictionary defines 'house' as building for human habitation or occupation. The Chambers Twentieth Century Dictionary defines 'house' as a building for dwelling ; a dwelling place, an inn ; a public house. The word 'dwelling' is defined as place where one dwells or resides. Therefore, emphasis is laid on human dwelling or residence. Wealth-tax is concerned with homo sapiens such as individuals or group of individuals called the HUF and, therefore, exemption is available for them only. Therefore, the crucial test is whether the building is one fit for human habitation or residence or dwelling. The Orissa High Court has considered the definition of the word 'house' in the context of exemption under Section 5(1)(iv) claimed in the case of K.B. Pradhan (supra). The question in that case was whether in a case where house construction was continuing and incomplete exemption under Section 5(1)(iv) was available. The WTO denied the exemption in that case on the ground that the house was incomplete since the work was in progress and the AAC affirmed such view but the Tribunal allowed the claim. The High Court remanded the matter to the Tribunal for arriving at a definite conclusion as to whether on the valuation dates the construction had reached a stage of habitability and if it was found that the house was habitable it should be treated as a house and the exemption would be available and not otherwise. Thus, the concept of human habitability is inherent in the word 'house' according to the decision of the Orissa High Court in K.B.Pradhan's case (supra). The Board's circular cited by the assessee also uses the expression 'house' whether it is used for own residence or let out on rent for residential purposes or commercial purposes. It is inconceivable in the case of the assessee to hold that the godowns which are being used by the Tamil Nadu Civil Supplies Corporation for storing foodgrains are habitable by human beings The question of habitability does not arise in the case of objects such as goods, storing materials, etc., nor Section 5(1)(iv) is concerned with them.
Thus in the light of the decision of the Orissa High Court, the Board's circular and the dictionary meanings, the exemption is available only in a case of house or part thereof which is habitable by human beings and the exemption, therefore, consequently, is not available in respect of godowns used for storing foodgrains inasmuch as it is only a storehouse or a godown and not a house fit for human habitation. Coming to the decision of the Tribunal in the case of Baba Estates (supra), again it is 10 be emphasised that while every house is a property or a building, every property or building in terms of Section 26 of the 1961 Act is not house in terms of Section 5(1)(iv) of the 1957 Act. Since this is a case of exemption strict interpretation is to be applied When once the crucial test, namely, whether it is fit for human habitation or dwelling or residence is satisfied, it is immaterial for what purpose it is used or applied, but so long as the test remains unsatisfied the exemption is not available at all, much less to a godown as in the case of the assessee. In this view of the matter, therefore, we uphold the order of the AAC and reject the grounds taken by the assessee.