9911796707
TMI Blog1981 (9) TMI 162X X X X Extracts X X X X X X X X Extracts X X X X ..... paintings taken on 1-1-1954 at Rs. 50,000." 2. The assessee is one of the daughters of late H.H. Maharaja of Kishangarh who handed over paintings and jewellery and other articles to the assessee before his death. During the year under consideration the assessee sold paintings for Rs. 1 lakh and claimed that the paintings having been personal effects were not liable to capital gains tax. The ITO found that the paintings in question were sold to Lila Agencies Exports, Jaipur, and that a similar point had already been decided in the case of late H.H. Shri Sumersinghji in the assessment year 1964-65 wherein it was held that the paintings held by him were capital assets. The ITO paid a personal visit to the assessee's house and found that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee and the same were personal effects and as such they were not covered by the definition of the capital asset as provided in section 2(14). The AAC confirmed the action of the ITO by observing as under : "I have considered the arguments of the learned counsel of the appellant. In this case paintings which were sold cannot be regarded as the personal effects of the assessee in view of the fact that they were not being used by the assessee and were being preserved by her in order to sell the same at some opportune time at a high profit. These paintings were intended for same as is evident from the conduct of late H.H. Maharaja of Kishangarh who sold some of the paintings in 1964 and also of the appellant who sold the paintings in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m capital gains tax as it is expressly excluded by section 2(14)(ii). He took us through the orders of the AAC and pointed out that the AAC confirmed the action of the ITO on the main ground that the paintings were intended for sale. He further pointed out that the Tribunal in the case of the assessee herself in WT Appeal Nos. 749, 750 752 (Jp.) of 1980 recorded a finding of fact that the said sale of paintings could not establish the intention for sale of the paintings on the part of the assessee. To sum up, the submission of the learned counsel for the assessee is that the paintings in question having been commonly used by the assessee and unintended for sale, the lower authorities were wrong in holding that the paintings were capital a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 5(1)(viii) of the Wealth-tax Act. He relied on the decision in the case of G.S. Poddar v. CWT [1965] 57 ITR 207 (Bom.) wherein the Bombay High Court held that gold caskets, gold glasses, gold cups, saucer and spoons, and photo-frames used for display in the drawing room could not be considered to be household utensils and that the use of paintings as a decoration in the drawing room, which is only collected to give a pride of possession, is not contemplated by the exemption, and that the personal use which is contemplated by the exemption is the use of like nature as the use of other items mentioned in the clause, viz., furniture, household utensils, wearing apparel and provisions, etc. According to him, the lower authorities had given ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of "personal effects". As per Black's Law Dictionary, the expression "personal effects" means articles associated with person, as property having more or less intimate relation to person of possessor; and as per 'Words and Phrases' permanent edn., Vol. 32, at page 277, the words "personal effects" mean articles which are used to designate articles associated with person, as property having more or less intimate relation to person or possessor of such tangible property as attends the person. On a consideration the facts of the case, it can be legitimately presumed that the paintings in question that were sold by the assessee during the year under appeal were articles associated with the assessee as property having more or less intimate rel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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