Law:

Section:

Section 5 of the Wealth-tax Act, 1957 - Exemption - Position prior to 1-4-1993 - Assessment years 1964-65 and 1965-66 - Whether Explanation 1 to section 5(1)(viii) added by Finance Act, 1971 only made explicit what was implicit in said provision from its inception - Held, yes - Whether, therefore, even for assessment years prior to 1-4-1972, word "jewellery" in section 5(1)(viii) would include ornaments made of gold, silver, platinum or any other precious metal or any alloy whether studded with precious jewels or not and, exemption under section 5(1)(viii) would not be available to such ornaments for assessment years in question - Held, yes FACTS For the relevant assessment years, the WTO included the value of jewellery as assessable. This inclusion was upheld in appeal. On second appeal, the Tribunal held that ornaments which were studded with jewels or jems, whether initiation or genuine, would not be exempt but ornaments which were not studded as such, would be exempt from wealth-tax. The Tribunal remanded the matter for recomputation of the value of the jewellery accordingly. On reference : HELD Clause (viii) of section 5(1) was amended by the Finance (No. 2) Act, 1971, retrospectively to be effective 1-4-1963. The following words were added at its end : "but not including jewellery" An Explanation was also added to this clause with effect from 1-4-1972. The Explanation made it clear that the word "jewellery" was taken in its wider meaning. It included ornaments whether studded with precious jewels or not. It was, however, argued that the Explanation was prospectively added and was not available for an assessment year prior to 1972. This was not acceptable. The phrase "but not including jewellery" was added with effect from 1-4-1963. The word "jewellery" as commonly understood includes ornaments made of precious stones. Therefore, the Explanation only made explicit what was implicit in the provision from its inception. Therefore, the word 'jewellery' intended for personal use of the assessee within the meaning of section 5(1)(viii) would not exclude ornaments made of gold, silver, platinum or any other precious metal or any alloy, for the assessment years…

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