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TMI Blog2017 (6) TMI 687X X X X Extracts X X X X X X X X Extracts X X X X ..... can be put to such a use was wholly incidental to the article being a “work of art”. The Tribunal, in our opinion, therefore committed an error in holding that even if the article was one of “work of art”, since it is possible to be put to personal use, it would get ejected from Clause (xii) and would fall only under Clause (viii) of Sub-section (1) of Section 5 of the Act. The question framed is answered in favour of the assessee. Tax Appeals are allowed. Judgment of the Tribunal is set aside and that of Commissioner (Appeals) is restored. - TAX APPEAL NO. 114 of 2002 And 115 of 2002, TAX APPEAL NO. 116 of 2002 And 244 of 2003, TAX APPEAL NO. 248 of 2003 - - - Dated:- 7-6-2017 - Mr. Akil Kureshi And Mr. Biren Vaishnav JJ. For the Appellant : Mr. Manish J Shah, Advocate For the Opponent : Mr. KM Parikh, Advocate ORAL JUDGMENT ( PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. These appeals arise in common background. We may record facts from Tax Appeal No.114 of 2002. 2. This appeal is filed by the assessee challenging the judgment of the Income Tax Appellate Tribunal ( Tribunal for short) dated 26.9.2001. Appeal was admitted for consideration of follo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Baggi was kept. Having inspected the article, he proceeded to pass the order in appeal of the assessee and allowed the same. He was of the opinion that the engraving and embossing on the gold panels was exquisite. The art work was breathtaking. The designs contained figures of animals like elephants and horses and the extended figures were hollow from behind and not made of solid gold. The use of gold was therefore incidental and the assessee did not intend to pack the article with solid gold. The Commissioner (Appeals) thus was influenced by two factors. First was that according to him the article was a work of art and second that use of gold was incidental. On such considerations, he held that the article would fall under Clause (xii) of Sub-section (1) of Section 5 of the Wealth Tax Act and would, therefore, qualify for the exemption claimed by the assessee. 7. The department carried the matter before the Tribunal. The Tribunal was of the opinion that article was covered under Clause (viii) of Sub-section (1) of Section 5 of the Act since it was intended for personal use. Further, since the article contained gold, the exclusion clause of the first proviso to the said Clau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said to be one of work of art, in clear terms, the Tribunal has based its conclusions on a single factor viz. even if a particular article is a work of art , as long as it falls under Clause (viii), it would be governed by the said provision with all exclusions provided in the provisos. Two issues, therefore, present themselves before us. (i) Is article in question a work of art , and (ii) if so, if it also happens to be an article for personal use would it fall under Clause (viii) and be automatically excluded from Clause (xii). 9. In order to answer these questions, we may reproduce the relevant statutory provisions. Exemption in respect of certain assets. 5. ( 1) .......... ( viii) furniture, household utensils, wearing apparel, provisions and other articles intended for the personal or household use of the assessee, (but not including jewellery). Provided that the furniture, utensils or other articles are neither made wholly or partly of, nor contain (whether byway of embedding, covering or otherwise), gold, silver, platinum or any other precious metal or any alloy containing one or more of such precious metals: Provided further ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is a work of art ? According to Chambers Dictionary, work of art means a panting, sculpture or other production in the fine arts, esp., one of high quality; anything constructed or composed with manifest skill. 17. Problems of definition as to what are the arts and work of art elude solution. In the New Encyclopedia Britannica, Vol. 2, 15th edition, it is stated: What are the arts, and what is art in general? This is still a controversial question after centuries of debate. No particular definition commands universal assent. Several meanings are still frequently used, of which the oldest is the broad, technical sense. In this sense, the English term art and its equivalents in Greek and Latin covered not only what are now called fine arts or aesthetic arts but any kind of transmitted, useful skill, such as agriculture, medicine, and war.... In the 19th and 20th centuries, there has been a tendency to abandon the term art in speaking of the purely utilitarian skills and to call them instead industries, technics, branches of engineering, or applied sciences. Without the prefix fine, the word art alone is now commonly understood to mean the fine or aesthet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt, however, its meaning has to be construed in the context of the provision of section 5(1)(xii) of the Act, and the expression works of art is employed along with other expressions like archaeological, scientific or art collections, books or manuscripts belonging to the assessee. Therefore, there must be an element of human skill involved or applied in the manufacture of the product which on mere look up it can be regarded as works of art. In Halsbury's Laws of England, fourth edition, in paragraph 892, the expression works of art is defined as follows: Works of art applies to painting, drawings and pastels executed by hand, original engraving prints and lithographs and original sculptures and statutory (sic) in any material. In Sampath Iyengar's The Three New Taxes, the expression and term works for art (at page 388) is as under: Works of art are those which are the result of human skill applied in various directions, such as, sculptures by Michael Angelo, painting by Raphael, Ruben, Vandyke, Leonardo da Vinci, Botticelli, Rembrandt, etc., or portraits by Ravi Varma, etc. Leading examples of private art collections in India but to which pu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thing which is rare and/or exceptional aesthetic beauty with artistic input. 18. The Commissioner (Appeals) had visited the site and found that the engravings on the panels of the Baggi are exquisite and of breathtaking beauty. The Tribunal did not disturb these findings. In fact, the Tribunal proceeded on the footing that even if the article was one of work of art , being an article for personal use would not qualify for exemption under Clause (xii). 19. While the Commissioner (Appeals) has pursuant to his personal inspection found the article to be one of the work of art by applying the parameters, which we do not find incorrect, and when the Tribunal has not disturbed these findings, we would conclude that the Baggi presents the work of art . 20. Once it is so held, the article would fall under Clause (xii) of Sub-section (1) of Section 5. Merely because incidentally it may also fall in Clause (viii), by itself, would not destroy its very essence of an article of work of art . Being an exemption clause, the Court would apply the provision which furthers the intention of the legislation rather than frustrating it. This was so held and observed by a Division Benc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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