1. The assessee is an individual. There was a raid in the premises of the assessee and certain assets were seized. While filing the return of net wealth, the assessee returned the cash, etc., seized, but claimed in Statement III various other items seized during the search action as exempt from wealth-tax. These included coin collections to the extent of Rs. 4,17,688, pooja coins Rs. 30,148, miniature paintings valued at Rs. 2,31,350 and certain currency notes, etc. In support of his claim for exemption under Section 5 of the Wealth-tax Act, 1957 ('the Act') for the above assets, the assessee relied on an order of the Tribunal in the case of one Shamsunder G. Aggarwal. Holding that the artistic work done on coins do not entitle the assessee to the exemption, the WTO rejected the assessee's claim for exemption under Section 5(1)(xii). The WTO noted that the Tribunal had rejected in Shamsunder G, Aggarwal's case the claim for exemption of coins considered as archaeologically valuable. The WTO rejected the assessee's claim for exemption of miniature paintings under Section 5(1)(xii) and (xiii) and also the claim for deletion of the foreign currency notes amounting to Rs. 9,076. On appeal the Commissioner (Appeals) confirmed the orders of the WTO. The valuation of these assets was upheld by him. It is against this order of the Commissioner (Appeals) that the present appeal is laid before the Tribunal.
2. The learned counsel for the assessee has pointed out that a complete 1st of coins has been given, indicating that they owe their existence for over a period of years if not centuries, contributing to the study of history and archaeology to fall within the scope of the exemption claimed. These coins are preserved or held by the assessee not for their metallic or other worth, but merely because they are landmarks in history over the period of centuries and give a pride of possession to the holder thereof. Even the valuation of these assets go to indicate this aspect of the matter in unambiguous terms. The learned counsel has quoted several authorities to support his case that the coins in the present case are valuable antiquities not of value in themselves but for what they indicate, they are also of importance from the viewpoint of archaeological study. They come clearly within the exemptions for work of archaeological value or art collections, etc., provided for in the Act. In particular, reference is made to the following in the Encyclopaedia Britannica on pages 232 and 233 (volume 2) : Archaeology is that science or art-it can be maintained that it is both- which is concerned with the material remains of man's past.
There are two aspects to the archaeologist's concern. The first of these is the discovery and reclamation of the ancient remains ; this usually involves field of excavation or at least surface collecting.
The second concern is the analysis, interpretation and publication of the findings.
In terms of the history of ideas, it would appear that one of the two major approaches to archaeological thought arose within the great humanistic tradition of the Renaissance. Part of the reviving interest in. classical Greece and Rome was a concern within the art and architecture of the Greeks and Romans. Sculpture, pottery and coins were collected and excavation was undertaken.
Reference is made to the 3rd edition of the Book of Robert Friedberg titled 'Gold Coins of the Works' stating in the preface as follows : The collecting of gold coins seems to have become a part of mankind almost since the first gold coins were struck by the ancient Greeks about 700 B.C. Since then, gold coins have thus been struck over the centuries and fortunately many have survived to enrich the culture of our times and provide the numismatist with a lifetime of pleasure and study.
Gold coins which have been buried or otherwise secreted for hundreds or even for 2000 years, when finally discovered, were found to be in the same brilliant and untarnished condition as when they were first hidden.
It is this age-old tendency for gold to go underground that continually results in the unexpected discovery of new, unpublished coins, some of which may cast important light on a personage or place otherwise unknown or be clouded in history.
Referring to the listing of Numismatics in volume 16 of the Encyclopaedia Britannica, page 615, the learned counsel has sought to argue that the coins are the most imperishable antiquities and are a contemporary reflection of the culture of the times they were made.
Their study yield a considerable amount of information about the past-which is the very concept of archaeological study.
3. The assessee has invested as a connoisseur and a lover of art in these coins. It was not his intention to sell them, but to retain them as pure works of art and articles of archaeological interest in the family. This has nothing to do with his business or business interest.
The learned counsel stressed the statement made by the assessee before the WTO to the effect that the preservation of these coins and adding to their collection is a hobby of his and has nothing to do with the holding of the personal wealth or his business. Both the conditions with regard to nature of the asset as well as intention of not to sell are satisfied in the present case. Not only has the assessee any intention to sell these assets on the valuation date-which is the point at which the assessee's intention is to be tested-but the assessee has all intentions to preserve these assets as a heirloom from generation to generation in the family. On the question of intention, it is stressed that the intention is to be gathered from what the assessee himself says and his conduct and also the surrounding circumstances.
His intention is to be gathered for wealth-tax purposes as on the valuation date. The absence of any sales and any other circumstances indicating any idea of future sale on the part of the assessee, according to the learned counsel, clearly satisfied the requirements of the exempting provisions of the Act. The assessee had absolutely no foreseeable intention of sale. A similar position obtained in the assessee's brother's case and the Tribunal has accepted the claim of the assessee in that case for exemption. On the same basis the exemption should be granted in the present case. Support is also sought to be gathered from the orders in the case of Shri Rajkumar Aggarwal, where silver coins of different denominations and of different countries were exempted on the basis of the Tribunal's decision in the case of Shamsunder Aggarwal.
4. On the question of valuation, it has been claimed that part of the coins and other items in the list belonged to the assessee's brother.
Reference is made in this connection to the letter addressed to the ITO dated 18-3-1975, where it was pointed out that in the wealth-tax returns from the assessment years 1972-73 onwards of the assessee and his four brothers, silver utensils have been disclosed to the extent of 250 kgs., part of which were utensils and the balance coins. The said utensils belonged to the assessee and his four brothers in the proportion indicated in that letter. The silver coins weighing about 68 kgs., valued at Rs. 83,600, belong to the assessee's brothers. That this asset does not belong to the assessee is clear from the fact that utensils were also lying at the residence of his other brothers of which the details and weights were available. According to the learned counsel, the value of the utensils and vessels belonging to his brothers amounting to Rs. 81,600 should, therefore, be excluded from his net wealth. In support of this claim, reference is made to the affidavits filed by the assessee's brothers which clearly indicated the existence of these silver utensils and are in the possession of the assessee. The affidavit has not been controverted in essentials or proved to be not correct. In fact in the brothers' case, the utensils were indicated in the returns filed by them from the assessment year 1972-73 and this was clear indication of the fact that part of the silver vessels found in the assessee's possession at the time of the raid on 9-1-1975 belonged to the brothers who had also indicated it in the returns filed by them. It is also pointed out that in so far as the affidavits filed by the brothers have not been controverted by cross-examination as laid down in Mehta Parikh & Co. v. CIT  30 ITR 181 (SC), the assertions therein should be accepted.
5. In the grounds of appeal the assessee has challenged the increase in value of the coins, etc., by Rs. 19,688, but at the time of the hearing, this was not pressed.
6. Exemption is claimed in respect of the miniature paintings under Section 5(1)(xiii), these also being held as heirlooms in the family, being not intended for sale. A complete list of the paintings is given and their correct value indicated. According to the learned counsel, the WTO was not correct in denying the exemption under Section 5(1)(xiii) in respect of these paintings. It is also pointed out that the valuation adopted for these miniature paintings is excessive.
7. For the department stress is laid on the orders of the authorities below. According to the learned counsel, the assessee is a businessman and a dealer in non-ferrous metals. He owned more than 4,000 shares in companies dealing with such metal. The assessee's interest in old coins, according to the learned counsel, was also part of his activity as a dealer in metal. From this background it was clear that the assessee was a dealer in metal and a businessman on the one hand, while on the other there was a complete absence of any interest in collection of coins, paintings, etc. Apart from the assessee's lack of interest as a connoisseur in these articles, the learned counsel has also pointed out, that these articles were discovered in a raid and were not shown to the department by the assessee. This went to the very root of the assessee's assertion that he was taking interest in these articles as a connoisseur or as a hobby and intended to retain them in the family.
There was nothing to indicate that as far as the assessee was concerned, these items were not for sale. The fact that these items were concealed from the department and would have remained so but for the raid, according to the learned counsel, is an added pointer in this direction.
8. On the question of a part of the coins, utensils, etc., belonging to the brothers, raids had been conducted in the houses of the brothers also and no coins were discovered indicating not even the alleged interest in coins which the assessee claims as relevant to the brothers' cases. The wealth-tax returns filed by his brothers showed only utensils and not coins. The assessee's contention, according to the learned counsel, therefore, was a made up affair and should not be accepted.
9. The assessee is a businessman carrying on business in non-ferrous metal for a long time. He has been the holder, as the learned counsel for the department stated, of a substantial number of shares in companies akin to this business. He has claimed exemption in respect of coins, miniature paintings and foreign currencies under the provisions of Section 5. The assessee does not have a history of being connoisseur in archaeological specimens, paintings, or any other like interests.
The assessee aged 48 is a B.Sc. in Industrial Engineering and has done a Management Course in the United Kingdom, but it is clearly admitted, both before the authorities below and in the arguments before us, that the assessee had not prior to the purchase of the assets in question at any time been closely associated or even remotely connected with pursuit of art, painting or archaeological study. He is not a student of these faculties. It is stated that he has started this as a hobby and intended to continue it for the future. This is put up to controvert the departmental challenge to the exemption on the ground that there is nothing to show that these assets were not intended for sale as required by Section 5. In the statement given before the authorities below, the assessee has hinted that this was a hobby started by him. A hobby does and can relate to a cultural pursuit unconnected with business or earning but as specific statement in the reference indicates that the assessee has been advised to take up this hobby as it has substantial future potentialities. A reading of the statement indicates that the assessee has not ignored or forgotten the fact that even a hobby could be of substantial material or monetary advantage to one who pursues it. Be that as it may, the assessee has not been able to positively establish that the alleged works of art, even if they be so, are entitled to exemption under the strict terms of Section 5.
Subject to the provisions of Sub-section (1A), wealth-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- (xii) any works of art, archaeological, scientific or art collections, books or manuscripts belonging to the assessee and not intended for sale ; (xiii) any drawings, paintings, photographs, prints and any other heirloom not falling within Clause (xii) and not intended for sale, but not including jewellery; We accept the assessee's claim that the assets in the present case will be works of art as dealt with in the above clauses. Apart from the nature of the assets themselves which are specified by the clauses quoted above, an essential element for getting the exemption is that these assets are 'not intended for sale'. The section does not lay down the criteria for arriving at any decision on this aspect of the matter.
It has, therefore, to be gathered from the intention of the assessee, his conduct and the surrounding circumstances. It is not disputed that non-intention of sale is an essential ingredient of the exemption. The assessee has stated that he has not at any time contemplated sale of any of the assets in the present case, that his conduct in retaining the assets during the valuation date in question itself is relevant for the purpose and his subsequent conduct, in not selling them is sufficient to establish this intention. We agree that establishment of a positive intention as required in the present case directly may be difficult but it is not impossible. It does not, however, for that reason permit us to allow the exemption on the ground of mere assertions to serve one's own purpose of vague probabilities. It is possible to even positively create situations or establish a position unambiguously indicating that the assessee does not want to sell these assets. Alternatively, from the surrounding circumstances and the behaviour of the assessee, it could be possible to satisfy the test. In respect of the first, for instance, if the assessee had unequivocally divested himself of control over these assets partly or fully such as putting it under the guidance of independent trustees, etc., that may be one indication of the assessee's non-intention to sell them. This is only given as an illustration, but it may be possible in appropriate cases to establish directly that the assessee does not intend to sell the assets. The alternative method of satisfying the test, however, is applicable in every case and also in the present case.
11. In our opinion, neither the background of the assessee nor his conduct satisfies the test of non-intention for sale of the assets in the present case. As pointed out earlier, though highly educated, widely travelled, etc., the assessee has at no time shown an inclination for a special appreciation of works of art, paintings, or archaeological specimens. Admittedly, the assessee has not even as a layman been collecting these assets from time to time or over a time.
If a person wants to collect substantial works of art, etc., as a heirloom and with no intention to sell, the normal thing would be for him to collect it as and when available and wherever available and over a period of time. We are not regarding this as an infallible test but it does provide an indication of the assessee's attitude to art and business. Even a person who is not interested as a connoisseur or is not knowledgeable in these assets can decide to collect them and leave them as heirloom without selling. But even in such a case the intention to collect not for sale should be clear. Again the assessee is stated to have purchased these collections from a stranger on a single day.
The full particulars of the seller are not available. In fact the assessee claimed that this stranger is a broker who has collected these assets from several parties. Neither the particulars of the parties nor even the broker are available. All this is intriguing and does not set a dependable background for a connoisseur of the arts as the assessee claims to be. These assets were discovered in a raid in the assessee's premises. They were neither returned for income-tax or wealth-tax purposes nor their presence with the assessee indicated either to the Income-tax Department or any other outsider. Normally a collector of art, archaeological material, etc., would be proud to exhibit them to outsiders or at any rate to persons interested in them or knowledgeable about them. That this is completely absent in the present case and on the contrary the fact that the department came across these assets only in a raid, would be a point very much against the assessee's claim. The conduct of the assessee thus does not indicate that these assets purchased by him on a single occasion are intended to be kept with him and are not for sale. The assessee has not made any trust or any other provision for management or maintenance of these assets which would indicate that they are to be kept with him for an indefinitely long time and not to be disposed of at his will. Except the fact that on the valuation date the assessee has not sold these, there is absolutely no evidence to show that these are not intended for sale.
12. It may be mentioned that in the Wealth-tax Act as under the Estate Duty Act, there are no provisions with regard to the treatment of assets kept as heirlooms, works of art, etc., when an occasion for compulsory or voluntarily sale of these assets come up for consideration. While under the Estate Duty Act, provisions on the sale of such assets duty is attracted, the exemption under the wealth-tax is unqualified and almost absolute. This calls for a most strict application of the provisions and cast a more onerous duty on the assessee to establish that these items are not intended for sale.
Otherwise it would be possible for any person to rush into the market and before every valuation date purchase admittedly works of art and archaeological material and claim exemption on the valuation date and sell it off subsequent thereto. The test for non-sale and the proof thereof, therefore, have to be strict. A mere assertion on the part of the assessee that these are not intended for sale may not be sufficient. We do not, however, agree with the contention of the department that merely because these assets have been purchased by a businessman and that too, as stated, purchased on one occasion, the exemption should be denied to the assessee. The exemption is available if directly or indirectly the test as to 'not intended for sale' is satisfied. We do not think that even in the case of an assessee who at one time invests a substantial part of his net wealth if not the entirety of it in works of art, paintings, archaeological material, etc., but thereafter proves that he has no intention to sell them such as by creating a trust, putting the property outside his control, clear declarations and affirmations to the effect that they should not be sold, etc., the exemption could be denied. Ordinarily a person may invest a small or reasonable portion of his entire asset in archaeological material, etc, to be held as heirloom or as part of a hobby but the mere fact that a person desires to invest a very substantial part of his asset if not entirety of it in such assets and materials would not by itself be sufficient to disentitle him to the relief.
13. Viewed in the light of the above, we find no material on record to show that the assessee has kept these assets without any intention to sell them. This being the very basic necessity for availing of the exemption, the assessee cannot, therefore, be given the relief. The addition is sustained.
14. With regard to the claim of the assessee that part of the assets belonged to his brothers, there is absolutely no direct proof in support of the same. On the contrary, the facts referred to by the learned counsel for the department and the order of the Commissioner (Appeals) clearly indicate that there was no established connection between these utensils, coins, etc. and the assessee's brothers. In fact even though the brothers have indicated some assets in their returns, coins were absent. The decision of the authorities below on this point is upheld.15. On the question of miniature paintings and foreign currency their inclusion in the assessment and their valuation for such inclusion does not call for any interference, the assessee not having made out any special argument to support in this behalf.
16 & 17. [These paras are not reproduced here as they involve minor issues.]