1987 (8) TMI 58

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..... nal was justified in holding that the value of paintings was not includible in the wealth of the assessee ? " It relates to the assessment years 1964-65 and 1965-66. The facts of the case giving rise to it may be summarised thus. The assessee, the late Shri Moti Chand Khajanchi, was the karta of his Hindu undivided family. Besides holding movable and immovable properties, he held paintings, manuscripts and other art objects. In the wealth-tax returns for the assessment years 1964-65 and 1965-66, he made a note in them to the effect that drawings, paintings, manuscripts, etc., being not intended for sale were exempt under section 5(1)(xii) of the Act and hence not declared in the return of wealth-tax. During the assessment proceedings, he .....

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..... it was not an adventure in the nature of trade. He further contended that these paintings were sold in the national interest on the great persuasion of the Director, National Museum, New Delhi, the previous sale to Vidyapeeth, Sangaria, was effected on account of the great insistence of Swami Keshavanandji in the year 1949-50 and all these paintings and art objects were purchased from his personal money except once. No account of their purchases was ever maintained and his collections were held in high esteem by various authors, curators and lovers of art. He lastly contended that he held the paintings and curios in pursuit of his hobby and he never intended to sell them. The learned Tribunal has categorically observed in para. No. 7 of h .....

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..... mmissioner, Income-tax, Rajasthan II, Jaipur, reference was made by the Tribunal relating to the said assessment years 1964-65 and 1965-66 and it has been rejected by this court by its detailed order passed today in Income-tax Reference No. 10 of 1976, CIT v. Moti Chand Khajanchi[1988] 171 ITR 280. The Tribunal has correctly applied the law to the admitted or proved facts and has correctly held that the disputed paintings were not intended for sale. The learned Tribunal rightly held them exempt from wealth-tax. As such, the aforesaid question deserves to be answered in the affirmative. In the result, the aforesaid question is answered in the affirmative, against the Department and in favour of the assessee. - - TaxTMI - TMITa .....

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