Law:

Section:

Section 45, read with section 2(14) of the Income-tax Act, 1961 [Corresponding to section 12-B, read with section 2(4A) of the Indian Income-tax Act, 1922] - Capital gains - Chargeable as - Assessee was a minor - Government having declared assessee, as successor of former Maharaj, released to him certain assets consisting of gold sovereigns, silver coins and silver bars - Subsequently, on Government's suggestion assessee sold said assets - He claimed that there was no voluntary sale chargeable to capital gains tax under section 12B of 1922 Act and aforesaid items did not constitute "capital assets" as contemplated by section 2(4A) of 1922 Act but fell within purview of exception carved out by clause (ii ) thereof and as such were to be excluded in computing gains because they were held for personal use by assessee and his family members as was evident from fact that they were used for purpose of Maha Lakshmi Puja and other religious festivals and rituals in family - Whether only those effects can legitimately be said to be personal which pertain to assessee's person. - Held, yes - Whether silver bars or bullion could by no stretch of imagination be deemed to be 'effects' meant for personal use - Held, yes - Whether even sovereigns and silver coins which were customarily brought out of iron safes and boxes for puja purposes and other ritual purposes could not also be designated as effects meant for personal use - Held, yes - Whether, therefore, aforesaid articles were capital assets and not personal effects and as such could not be excluded while computing gains - Held, yes Words and phrases: Expressions 'personal use' and 'personal effects' as occurring in section 2(4A) of the Indian - Income-tax Act, 1922 FACTS The assessee, a minor, having been recognised by the Government as successor of the former Maharaja, certain assets consisting of gold sovereigns, silver coins and silver bars were released by the Govt. and handed over to Rajmata being the adoptive mother and guardian of the assessee. During the financial year 1957-58, the aforesaid sovereigns, silver coins and silver bars were sold at the suggestion of the Government. The assessee contended that there…

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