Law:

Section:

Section 5(1)(viii) of the wealth-tax act, 1957 [as amended by the finance (No. 2) act, 1971 with retrospective effect from 1-4-1963]-Exemption-Furniture, etc., and other articles intended for personal use-Assessability of "loose diamonds"-Whether tribunal was right in holding that "loose diamonds" owned by assessee were exempt from wealth-tax-Held, no-Whether tribunal had valid materials to hold that "loose diamonds" were articles intended for assessee's personal use-Held, no Facts For the assessment years 1967-68 to 1969-70, the assessee claimed exemption under section 5(1)(viii) in respect of the value of the jewellery, gold ornaments and loose diamonds owned by her. The WTO disallowed the assessee's claim but the same was accepted by the AAC. The Tribunal held (i ) that the loose diamonds were articles intended for personal use of the assessee and as such, immune from wealth-tax liability under section 5(1)(viii); and (ii) that the value of the jewellery and gold ornaments was not exempted from tax in view of the retrospective amendment made to the said provision with effect from 1-4-1963. On reference, the Revenue contended that even loose diamonds would come within the scope of jewellery but the assessees ought to repel this plea and contended that these would come under "other articles intended for the personal or household use of the assessee" occurring in section 5(1)(viii ). Held 1. In view of the amendment made in section 5(1)(viii) by the Finance (No. 2) Act, 1971 with retrospective effect from 1-04-1963, the other gold ornaments and jewellery were undoubtedly no longer entitled to exemption under section 5(1)(viii). 2. An analysis of various provisions in section 5 would reflect that the word "jewellery" would take its colour from the context in which it occurred. For example, "jewellery", in order to describe what was in possession of the ruler, might not have the same connotation as in the other clauses of section 5. Jewellery intended for personal use might be different from jewellery kept as an heirloom. In the context of section 5(1)(viii), read with the omission of section 5(1)(xv), it was clear that the jewellery, in its widest sense, was…

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