of Wealth Tax, Orissa, Bhubaneswar Vs. Smt. Binapani Chakravarty
 INSC 197 (28
Sujata V. (J) Manohar Sujata V. (J) Agrawal, S.C.
(J) Hansaria B.L. (J)
1995 AIR 1380 1995 SCC Supl. (2) 262 JT 1995 (3) 506 1995 SCALE (2)496
SUJATA V. MANOHAR J..- 1.These appeals by special leave from a common judgment
of the High Court of the Orissa in seven Reference Applications before it under
Section 27(1) the Wealth Tax 1957. The High Court was required to consider the
following question:- "Whether the word 'jewellery' in section 5(1)(viii)
of the Wealth-Tax Act, 1957 prior to the amendment of the section and the
introduction of the Explanation by the Finance Act (No.2) of' 1971 could take
in gold ornaments without precious or semiprecious stones embedded on
them?" The High Court has answered the question thus:- "The word 'jewellery'
in section 5(1)(viii) of the Wealth Tax Act of 1957 prior to amendment of the
provision and introduction of Explanation 1 by the Finance Act (No.2) of 1971
would not take in gold ornaments without precious or semi-precious stones
embedded on them." The Commissioner of Wealth Tax has filed the present
appeals from the above decision.
relevant assessment years are 1965-66 to 1971-72.
relevant valuation dates are 31st of March of each of the years in question. We
are, therefore, required to consider the provisions of Section 5(1)(, viii) of
the Wealth Tax Act, 1957 as in force during the relevant period.
5 of the Wealth Tax Act. 1957 deals with exemptions from wealth tax granted In
respect of certain assets.
5(i)(Viii), prior to its amendment by the Finance Act 2 of 1971, was follows :-
"5(i) : Subject to the provisions of sub- section (1A) weath-tax shall not
be payable by an assessee in respect of the following assets, and such assets
shall not be included in the net wealth of the assessee - (1) x x x x x 508 x x
x x x (viii) furniture, household utensils, wearing apparel, provisions and
other articles intended for the personal or household use of the assessee.
" Section 5(1)(viii) was interpreted in the context of the provisions of
Section 5(1)(xiii) and 5(i)(xv) by this Court in the case of Commissioner of
Wealth-Tax Gujarat v. Arundhati Balakrishna (77 ITR 505). The Court said that jewellery
intended for the personal use of the assessee would come within the scope of
the exemption granted under Section 5(1)(viii) -- being "other articles
intended for the personal....... use of the assessee." As a consequence,
the Finance Act 2 of 1971 amended the provisions of Section 5(1)(viii) with
retrospective effect from 1st of April, 1963, to read as follows :-
"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." (underlining ours)
same Finance Act of 1971, Explanation 1 was also added to Section 5(1)(viii).
The Explanation, however, was made effective only prospectively, with effect
from 1.4.1972. Explanation 1 is as follows :- "Explanation 1 : For the
purposes of this clause and clause (xiii), ''jewellery' in- cludes - (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
or semi-precious. stones, whether or not set in any furniture untensil or other
article or worked or sewn into any wearing apparel."
the present appeals we are concerned with the period during which the
retrospectively amended Section 5(1)(viii) was in operation but without
Explanation 1 (which came into effect from 1st of April, 1972). We have to
consider what is excluded from the benefit of the exemption granted under
Section 5(1)(viii). Is it only those items of jewellery which are studded with
precious or semi-precious stones or whether all ornaments and jewellery made
out of precious metals (such as gold, silver or platinum or alloys with
precious metals) are excluded from the exemption, although they may not be
studded with precious or semi-precious stones? 4.It has been urged before us by
the assessee that it is on account of Explanation 1 to Section 5(1)(viii) that
the term "jewellery" would also include ornaments made only of gold,
silver, platinum or any other precious metal or alloy containing such precious
metal, even though no precious stones arc embedded in them. It is submitted
that in the absence of such an Explanation during the relevant period, the term
"jewellery" would cover only ornaments studded with jewels or
precious stones. It would not cover in its ambit ornaments made only of gold,
silver, platium or any other precious metal or alloy.
interpret the word "jewellery" as such without the benefit of
Explanation 1, 509 we must first consider how the term "jewellery" is
ordinarily understood the New Shorter Oxford Dictionary "jewellery"
is defined as :
or ornaments made or sold by jewellers, especially precious stones in
collectively or as a form of adornment.
"Jewel" is defined as:
article or value used for (personal) adornment, especially one made of gold,
silver, or precious stones............. a pre- cious stone, a gem; especially
one worn as an ornament. " The term "jewel" and "jewellery",
therefore, refer to articles of value for adornment, especially those made from
gold, silver or precious stones. The terms are, therefore, wide enough to cover
not merely precious stones or articles of adornment made with the use of
precious stones, but also other articles of value made from gold, silver,
platinum or precious metals. Ordinarily speaking, when a person talks about jewellery,
he includes ornaments which arc made of gold, silver or any other precious
metal also irrespective of whether these articles have precious stones embedded
in them or not.
difference which is sought to be made out between ornaments which contain
precious stones, and ornaments of gold, silver and platinum which do not have
precious stones embedded in them, appears to be artificial. The term "jewellery"
is not confined in ordinary parlance to only those ornaments which have
precious stones embodded in them.
covers all articles of value used for adornment. A jewellery shop normarlly
sells not just precious stories or articles made of precious stones; it
certainly sells ornaments of gold and silver. It may be that in our local
languages, different kinds of bangles, necklaces and other ornaments carry
different and specific names depending upon their design and craftsmanship. But
these are all covered by the generic term "jewellery."
Undoubtedly, the Explanation has been introduced by the Finance Act of 1971,
partly to clarify this position. The explanation provides an extensive
definition of "jewellery." It includes ornaments made of gold,
silver, platinum or any other precious metal whether or not containing any
precious or semi-precious stones. It also covers, within the meaning of the
term, such items which may or may not be sewn into any wearing apparel. It also
includes precious and semiprecious stones whether or not set many furniture,
utensils or other article, or worked or sewn into any wear- ing apparel. The
Explanation may have extended the meaning of "jewellery" to cover,
for example, precious stones by themselves or precious stones set in furniture
insofar as it includes ornaments made of gold, silver, platinum or any other precious
metal or alloy, it is merely clarificatory in nature. Merely because ornaments
made of gold and silver are now expressly included in Explanation 1, it is not
possible to hold that they were earlier excluded from the meaning of the term
"jewellery." 8. In the case of Commissioner of Wealth-Tax, Delhi-II
v. Smt. Savitri Devi (140 ITR 525), a Division Bench of the Delhi High Court
held that the word "jewellery" as set out in the dictionaries and as
understood in common parlance, includes gold 510 ornaments made for personal
use. These are almost always a jeweller's job and cannot be made by anyone. The
Delhi High Court has held that the Explanation cannot take away the ordinary
meaning of the word "jewellery". The artificially enlarged meaning as
given by the definition in Explanation 1 also includes, by way of abundant
caution, the natural meaning of the term. hence jewellery, even before coming
into force of the Explanation 1, would include gold ornaments. We agree with
the reasoning of the Delhi High Court. This view is reiterated in Commissioner
of Wealth Tax, Delhi-III. v. Rukmani Devi(142 ITR 41).
similar view has been taken by the Gujarat High Court in the case of
Commissioner of' Wealth-Tax. Gujarat L v. Jayantilal Amratlal (102 ITR 105); by
the Allahabad High Court in the case of Commissioner of Wealth-Tax, Lucknow v. His Highness Maharaja Vibhuti Narain
Singh (117 FIR 246), and by the Madhya Pradesh High Court in the case of Nandkishore
Girdharilal Modi. v. Commissioner of Wealth-Tax, M.P. (132 ITR 868). Another
Bench of the Madhya Pradesh High Court in the case of Commissioner of
Wealth-Tax, MP. v. Smt. Sonal K. Amin (127 ITR 427) has, however, taken a
con" view. The Calcutta High Court has also taken a contrary view in the
case of Commissioner of Wealth-Tax, West Bengal- 1, Calcutta v. Aditya Vikrant Birla 14 ITR 711.
For the reasons which we have set out above, we do not agree with the contrary
view expressed by the Calcutta High Court in Aditya vikram Birla's case (supra)
and by the Madhya Pradesh High Court in Sonal K. Amin's Case (supra). The
Calcutta High Court has placed some emphasis on different vernacular terms used
for different types of ornaments. In our view, this is not, in any manner,
conclusive of the question whether the term "jewellery" includes
ornaments made of precious metals such as gold or silver. The contrary
decisions arc, therefore, overruled, 10.In the premises, the appeals are
allowed with costs.