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TMI Blog2013 (3) TMI 100X X X X Extracts X X X X X X X X Extracts X X X X ..... f inheritance from his father and uncle and the other, by way of a gift deed from his aunt. Whatever be the mode of acquisition of articles, the fact, as stated in his affidavit, is that these were in his personal use. Those articles were moveable properties. They did not include any jewellery and they had been held for personal use by the assessee and they were subsequently sold by him to various buyers. The fact that these articles were held by him for personal use has been indicated in the affidavit filed by the assessee before the assessing officer. No material has been brought out by the assessing officer or the revenue to indicate that the affidavit is false. Therefore, on the basis of evidence on record, the articles in question ought to have been held to be "personal effects" of the assessee. The amendment to section 2(14) has prospective operation with effect from 01.04.2008, whereas in the present case the assessment year is 2002-03 - appeal decided in favour of the assessee and against the revenue. - ITA 613/2012 - - - Dated:- 20-2-2013 - Badar Durrez Ahmed Versus R. V. Easwa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on silk carpets) 35 items B. Paintings 20 Pcs C. Collector items which included antique watches, rings and decorative items 14 Pcs D. House Hold Items which included crystal items 12 Pcs E. Antique Furniture which includes table, chairs, centre table, chest, etc. 34 Pcs 4. The Assessing Officer was of the view that the aforesaid items could not be treated as personal effects and were in fact capital assets within the meaning of Section 2(14) of the Income Tax Act and therefore refused to grant any exemption on the sales proceeds thereof from tax and included this amount for the purpose of tax. Another reason given by the Assessing Officer was that the assessee had failed to establish the identity of the items sold individually to each buyer or that these items have market value of Rs.39.47 lakhs. According to him, since the assessee had not produced any documentary evidence in support of his claim he, was not able to establish the genuineness of his claim for exemption under Section 2(14) of the Act. This was the additional ground on which he returned the plea of exemption under Section 2(14) of the Act. 5. The assessee preferred appeal there against before the CIT(A). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10.05.2011 did not disturb the finding of the Tribunal that the sales were genuine. 3. The only question which needed to be considered, in terms of the order dated 10.05.2011, was whether the articles sold by the assessee to different buyers could be treated as personal effects‟ and, therefore, would be eligible for exemption under Section 2(14) of the Income Tax Act, 1961. This Court by virtue of the order dated 10.05.2011 directed as under: - 12. The question was only applicability of Section 2(14) in respect of these articles. No factual aspects were involved and it was a question to be decided on the basis of facts. 13. Under these circumstances we are of the opinion that the Tribunal should have gone into this issue and decided the same. For this reason alone we remit the case back to the ITAT for deciding this aspect of the matter. For this reason we are not deciding the proposed questions of law. Parties to appear before the Tribunal on 18th July, 2011. Thereafter, the matter was taken up by the Tribunal and was disposed of by the impugned order dated 31.05.2012. In the impugned order we find that the Tribunal has exceeded the direction given by this Court. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hatever has been stated above is true and correct and nothing material has been concealed therefrom. Deponent From the above it is clear that the assessee had stated on affidavit that the articles which were either received by him as gift from his aunt or inherited from his father and uncle were articles of his personal use. 6. The definition of capital asset given in Section 2(14) of the Income Tax Act, 1961 indicates that a capital asset means property of any kind held by an assessee, whether or not connected with the business or profession but does not include :- (ii) Personal effects, that is to say, movable property (including wearing apparel and furniture, but excluding jewellery) held for personal use by the assessee or any member of his family dependent on him. Explanation :- For the purposes of this sub-clause, "Jewellery" includes (a) Ornaments made of gold, silver, platinum or any other precious metal or any alloy containing one or more of such precious metals, whether or not containing any precious or semi-precious stone, and whether or not worked or sewn into any wearing apparel; (b) Precious or semi-precious stones, whether or not set in any furnitu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estion as regards the frequency of use before any article could be regarded as a personal effect‟, observed that it would be difficult to understand as to why there should be such rationing of personal effects of the assessee for the purpose of giving the benefit of the exclusion clause contained in section 2(14). In that case the issue was with regard to 790 pieces of dinner sets. The Gujarat High Court held that if the assessee had more than one dinner set which were intended to be used by him and his family members, as and when dinner parties were arranged, there was nothing in the provisions of section 2(14) to enable courts to assign a restricted meaning to the words "personal effects" used in that provision. Therefore, the extent of use was held not to be a relevant factor. 10. The Supreme Court in CIT Vs. H H Maharani Usha Devi : (1998) 231 ITR 793 (SC) had also observed that the High Court had rightly held that the frequency of use of the property must necessarily depend on the nature of the property and that merely because from the nature of the property, it could be used on ceremonial occasions only, it did not follow that the property was not held by the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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