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Commissioner of Wealth-tax, Gujarat I Vs. Jayantilal Amratlal - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtGujarat High Court
Decided On
Case NumberWealth-tax Reference No. 23 of 1971
Judge
Reported in[1976]102ITR105(Guj)
ActsWealth Tax Act, 1957 - Sections 5(1); Finance Act, 1971
AppellantCommissioner of Wealth-tax, Gujarat I
RespondentJayantilal Amratlal
Appellant Advocate K.H. Kaji, Adv.
Respondent Advocate J.P. Shah, Adv.
Cases ReferredDilworth v. Commissioner of Stamps
Excerpt:
direct taxation - jewellery of hindu undivided family - section 5 (1) of wealth tax act, 1957 and finance act, 1971 - act of 1971 clearly provides that jewellery is liable to tax from 01.04.1963 with retrospective effect - no exclusion of jewellery of hindu undivided family - held, jewellery liable to tax from 01.04.1963. - - commissioner of wealth-tax held that the assessee was entitled to deduction in respect of taxation liabilities for the years under appeal as well as the preceding years on the basis of assessments as finally determined. arundhati balkrishna holds good. it is precisely on account of explanation 1(a) that the dispute in this reference has arisen. , including those of base metals, glass, plastic, or the like. the natural impact of the term 'jewellery' is very well.....b.k. mehta, j.1. at the instance of the commissioner of wealth-tax, the following two questions have been referred to us for our opinion : '(1) whether, on the facts and in the circumstances of the case, jewellery held by the hindu undivided family was exempt under section 5(1)(viii) (2) whether, on the facts and in the circumstances of the case, deduction admissible is in respect of tax payable pursuant to the relevant returns filed by the assessee or whether such deductions is admissible in respect of such tax as finally determined on assessments ?' the above question have been referred to us in the following circumstances; 2. the assessee is a hindu undivided family and the relevant assessment years for the purpose of this reference are 1962-63 to 1964-65. the assessee claimed before.....
Judgment:

B.K. Mehta, J.

1. At the instance of the Commissioner of Wealth-tax, the following two questions have been referred to us for our opinion :

'(1) Whether, on the facts and in the circumstances of the case, jewellery held by the Hindu undivided family was exempt under section 5(1)(viii)

(2) Whether, on the facts and in the circumstances of the case, deduction admissible is in respect of tax payable pursuant to the relevant returns filed by the assessee or whether such deductions is admissible in respect of such tax as finally determined on assessments ?'

The above question have been referred to us in the following circumstances;

2. The assessee is a Hindu undivided family and the relevant assessment years for the purpose of this reference are 1962-63 to 1964-65. The assessee claimed before the Wealth-tax Officer that the value of jewellery and ornaments amounting to Rs. 1,85,216 was exempt under section 5(1)(viii) of the Wealth-tax Act on the ground that they were meant for personal use of the ladies of the family. The Wealth-tax Officer rejected this claims of the assessee as the same was negatived in all the preceding assessments on ground that the assessee was not entitled to claim exemption in respect of the jewellery owned by the family beyond a sum of Rs. 25,000 under section 5(1)(xv) of the said Act. As the jewellery and ornaments was last valued on December, 31, 1959, and the value of the gold and jewellery had gone up considerably since that date, the Wealth-tax Officer enhanced the valuation by 12% as far as the gold ornaments were concerned and by 7 1/2% as far as other jewellery were concerned. He, therefore, after allowing the statutory exemption of Rs. 25,000 valued the jewellery and ornaments at Rs. 1,94,908. The assessee had also claimed deduction on account of Income-tax liabilities for the assessment years from 1959-60 and the wealth-tax liabilities for the year 1962-63. This claim was rejected by the Wealth-tax Officer as, in his opinion, there was no liability for these taxes as it did not arise till the assessments were made and demand notices were served in pursuance thereof on the assessee after the relevant valuation dates. The assessee, therefore, took the matter in appeal before the Appellate Assistant Commissioner. The Appellate Assistant Commissioner negatived the claim for deduction on account of jewellery for the assessment years 1962-63 and 1963-64. However, he allowed the appeal for the year 1964-65 following the decision of the Gujarat High Court in Commissioner of Wealth-tax v. Mrs. Arundhati Balkrishna. The Appellate Assistant Commissioner, however, upheld the claim of the assessee in respect of deduction of wealth-tax and income-tax liability for all the years of 1962-63 to 1964-65. The assessee being aggrieved with the orders of the Appellate Assistant Commissioner rejecting its claim for deduction of the entire valuation of jewellery and ornaments and also for tax liabilities went in appeal before the Tribunal. The Tribunal following the decision of the Supreme Court in Commissioner of Wealth-tax v. Arundhati Balkrishna held that ht entire value of jewellery was exempt from inclusion in the net wealth as the jewellery and ornaments were intended for personal use of the ladies of the family. The Tribunal following the decision Kesoram Industries and Cotton Mills Ltd. v. Commissioner of Wealth-tax and H. H. Setu Parvati Bayi v. Commissioner of Wealth-tax held that the assessee was entitled to deduction in respect of taxation liabilities for the years under appeal as well as the preceding years on the basis of assessments as finally determined. The Commissioner of Wealth-tax, therefore, sought the reference on two grounds, namely, (1) claim for deduction of entire valuation of the jewellery, and (2) claim for deduction of tax liabilities.

3. In the course of hearing of the application for reference a contention was sought to be urged whether the assessee is entitled to claim deduction on account of tax liabilities on the basis of return made or on the basis of taxes finally determined on assessment. The Tribunal, therefore, referred two questions set out hereinabove to us for our opinion.

4. On behalf of the revenue it has been urged that the amendment made in section 5(1)(vii) by Finance (No. 2) Act of 1971 excluding the jewellery from the purview of exemption under the said clause with effect from April 1, 1963, changes the complexion of exemption for the two assessment years involved in this reference, namely 1963-64 and 1964-65. As far as the assessment year 1962-63 is involved in this reference, it was conceded on behalf of the revenue that the ratio of the decision of the Supreme Court in Commissioner of Wealth-tax v. Arundhati Balkrishna holds good. It was, therefore, submitted that the entire valuation of jewellery and ornaments belonging to the Hindu undivided family of the assessee is liable to be included in its net wealth for the assessment years 1963-64 and 1964-65. On behalf of the assessee the contention of the revenue in so far as it sought to include the valuation of jewellery of the Hindu undivided family of the assessee in its net wealth was conceded and accepted. However, the attempt of the revenue to include the golden ornaments as jewellery and, therefore, not liable to be exempted under section 5(1)(viii) in view of the amendment made by the Finance (No. 2) Act of 1971 was resisted on the ground amongst others that the Explanation 1, added to the said section 5(1)(viii) by the aforesaid amending Act for the first time included the golden ornaments in the 'jewellery' by the inclusive definition given therein, came into force with effect from April 1, 1972, and, therefore, for all intents and purposes the intended definition of jewellery cannot be applied retrospectively for purpose of the relevant assessment years 1963-64 and 1964-65.

5. In order to appreciated the rival contentions of the parties, we set out hereunder the relevant sub-section before its amendment by Finance (No. 2) Act of 1971, and as it stands at present after the amendment incorporated by the said Act. Section 5(1)(viii) before its amendment read as under :

'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............... (viii) furniture, household utensils, wearing apparel, provisions and other articles intended for the personal or household us of the assessee.'

6. By Finance (No. 2) Act of 1971, with retrospective effect from April 1, 1963, after the existing clause (viii), the words, 'but not including jewellery' were added. It also added two provisos and two Explanations, which have been made prospectively effective from April 1, 1972. The said clause (viii), therefore, after the amendment by Finance (No. 2) Act of 1971, reads as under :

'(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 by way 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 that nothing in this clause shall operate to exclude from the net wealth of the assessee any conveyance or conveyances to the extent the value or the aggregate value thereof exceeds the sum of twenty-five thousand rupees.

Explanation 1. - For the purposes of this clause and clause (xiii) 'jewellery' includes -

(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 wearing apparel;

(b) precious or semi-precious stones, whether or not set in any furniture, utensil or other article or worked or sewn into any wearing apparel.

Explanation 2. - For the purposes of this clause 'conveyance' means any motor car or other mechanically propelled vehicle, aircraft or boat.'

7. The effect of the amendment in so far as it excluded jewellery from the purview of the exemption with effect from April 1, 1963, is to supersede the decision of the Supreme Court in Commissioner of Wealth-tax v. Arundhati Balkrishna and neutralize the effect thereof. The Finance (No. 2) Act of 1971 also simultaneously deleted clause (xv) which provided exemption to jewellery belonging to the assessee subject to a maximum of Rs. 25,000 with effect from April 1, 1963, and altogether a new clause was substituted providing exemption to deposits under any scheme framed by the Central Government subject to the conditions prescribed therein. The said Act also added two provisos and Explanations to clause (viii) and these provisos and Explanations have been brought into effect prospectively from April 1, 1972. The dispute in this reference has arisen on account of Explanation 1 by which the legislature has tried to define the word 'jewellery' for the purposes of clauses (viii) and (xiii) of section 5(1). For purposes of clauses (viii) and (xiii) 'jewellery' includes ornaments made of gold, silver, platinum or any other precious metal or 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 waring apparel, and also precious or semi-precious stones, whether or not set in any furniture, utensils or other articles or worked or sewn into any wearing apparel. It is precisely on account of Explanation 1(a) that the dispute in this reference has arisen. The contention of the assessee is that it is this legislative dictionary which the court has to consider for purposes of finding out whether the assessee is entitled to claim exemption in respect of the valuation of ornaments which have been now included in the meaning of the term 'jewellery' by the Explanation in the Amending Act, which has been brought into force with effect from April 1, 1972, and for purposes of the assessment years under consideration the golden ornaments could not have been included in the term 'jewellery' and, therefore, were entitled to exemption under clause (viii) on the ratio of the decision of the Superme Court in commissioner of Wealth-tax v. Mrs. Arundhati Balkrishna. It would, therefore, be necessary to find out what the Supreme Court has laid down in its decision in Commissioner of Wealth-tax v. Mrs. Arundhati Balkrishna. We must also bear in mind that section 5(1)(viii) was amended partly retrospectively and partly prospectively by the same Act, viz., Finance (No. 2) Act of 1971. It should be recalled that jewellery has been excluded from the purview of exemption under clause (viii) with effect from April 1, 1963, while Explanation 1 by which the legislature has given the meaning of the term 'jewellery' for purposes of clause (viii) has been brought into effect prospectively from April 1, 1972.

8. A Division Bench of the Gujarat High Court in Commissioner of Wealth-tax v. Mrs. Arundhati Balkrishna was concerned with the question whether the assessee was entitled to claim exemption in respect of jewellery or ornaments irrespective of its valuation, if they were intended as articles for personal use of the assessee. the revenue was contending in that case and in all other cases under the Wealth-tax Act till then that the assessee would not be entitled to claim successfully exemption for jewellery and ornaments irrespective of their value under clause (viii) of section 5(1) on the ground that they are articles intended for the personal use of the assessee in view of specific provision having been made in respect of jewellery belonging to the assessee under clause (xv) of section (5)(1) as then existing where an initial exemption of Rs. 25,000 was provided. The Division Bench of this High Court consisting of Bhagwati C. J. (as he then was) and Diwan J. (as he then was) rejected that contention of the revenue and held that jewellery and ornaments, if they were intended for the personal use of the assessee, were entitled to claim exemption irrespective of their valuation under clause (viii) of section 5(1). In the course of the judgment, Diwan J. (as he then was), speaking for the court, after referring to the decision in Casher v. Holmes, cited in Craies, and negativing the contention urged on behalf of the revenue by the learned Advocate-General that in construing section 5(1)(viii) the principle of words of rank should be applied, observed as under :

'On the strength of this decision, and particularly in view of the fact that under section 55(1)(x) of the English statute, the words 'personal chattels' included not merely articles of personal adornment but also articles of personal use, it was contended by the learned Advocate-General that in the instant case also jewellery and ornaments set out by the assessee in the annexure to the return must be considered to be jewellery falling with in section 5(1)(xv) and not as articles of personal use. He contended that jewellery is an article of personal adornment and not an article of personal use. Adornment and use are distinct things.

There are the two different contentions, one on the principle of interpretation of statutes set out in Craies; and the other regarding the meaning of the 'jewellery', which have been urged on behalf of the revenue.'

After referring to the first contention on behalf of the revenue on the principle of interpretation of statutes, the Division Bench proceeded to consider the second contention about the dictionary meaning of the term 'jewellery' and observed as under :

'So far as the dictionary definition is concerned, even according to the dictionary meaning, 'jewellery', can, if they fall within section 5(1)(viii), be excluded and are not necessarily governed by clause 5(1)(xv) of the Act.

In our opinion, the decision in In re Whitby cannot be of any assistance to us in deciding the particular question before us and we must decided the matter by interpreting the statute, looking at the different clauses in section 5(1) of the Act. Reading the provisions of section 5(1)(viii) and 5(1)(xv) together, it is clear that if any particular jewellery or ornament can fall within the description of the articles intended for the personal use of the assessee, then exemption can be claimed in respect of such jewellery and ornaments under section 5(1)(viii). If, on the other hand, jewellery and ornaments cannot be so described, e.g., if a male assessee is the owner of certain ornaments used by females, it cannot be said that this jewellery or ornament was an article intended for the personal use of the assessee and, in that case, the particular jewellery would fall to be governed by section 5(1)(xv) of the Act.'

This decision of the Gujarat High Court has been confirmed by the Supreme Court in Commissioner of Wealth-tax v. Arundhati Balkrishna. Hegde J. (as he then was), speaking for the court, held as under :

'Under section 5(1)(xv), as it stood at the relevant time, every assessee was entitled to deduct a sum of Rs. 25,000 from out of the value of the jewellery in her possession whether the same was intended for her personal use or not but under section 5(1)(viii) the value of all the jewellery intended for the personal use of the assessee stands excluded in the computation of the net wealth of an assessee.'

9. The effect of the decision of the Gujarat High Court in Mrs. Arundhati's case as affirmed by the Supreme Court is that, having regard to the dictionary meaning and more particularly the relevant provisions of the Wealth-tax Act, the articles of ornaments studded with jewels or not, compendiously known as jewellery would not be liable to be included in the net wealth of an assessee, if intended for his personal use. The dictionary meaning of the word, 'jewellery' is very clear. In the Random House Dictionary, unabridged edition, at page 767, the meaning of the word, 'jewellery' is given as under :

'1. a number of articles of gold, silver, precious stones, etc., for personal adornment.

2. any ornament for personal adornment, as a necklace, cufflinks, etc., including those of base metals, glass, plastic, or the like....'

In Shorter Oxford English Dictionary, third edition, at page 1064, the meaning of the word, 'jewellery' is given as under :

'jewellers' work; gems or ornaments made or sold by jewellers; jewels collectively, or as a form of adornment.'

10. The moot question, therefore, which arises for our consideration as far as the assessment years 1963-64 and 1964-65 are concerned, is whether the assessee is entitled to claim exemption under clause (viii) for the ornaments as they are said to have been included within the definition of the term 'jewellery' by the legislature only with effect from April 1, 1972, as prescribed in Explanation 1 to section 5(1)(viii). The learned advocate on behalf of the assessee has laid great emphasis on the fact that as the legislature has thought fit to define this term 'jewellery' by Explanation 1 which has been brought into force from April 1, 1972, the court cannot, for purposes of assessment years 1963-64 and 1964-65, consider the dictionary meaning of the term, 'jewellery' as including ornaments also and, therefore, in view of the fact that 'jewellery' as defined by Explanation 1 now being excluded from the purview of the exemption under clause (viii) would not be included in the net wealth of the assessee for purposes of the wealth-tax. We must frankly admit that this contention urged on behalf of the assessee is prima facie attractive about on a closer scrutiny, in our opinion, it does not stand to reason that the legislature could have such intention of taking out the ornaments from the sweep of the meaning of the term 'jewellery' and thereby continuing the benefit of exemption to the ornaments under caluse (viii) of section 5(1). The reasons are obvious. The gold, silver or other ornaments set with the jewels could not have been, without any violence to the language, be termed as articles other than jewellery. The natural impact of the term 'jewellery' is very well known and as stated in the decision of this court in Mrs. Arundhati Balkrishna case it is a collective description of jewellery as well as other ornaments of precious metals. In our view, the definition given by Explanation 1 added by the Finance (No. 2) Act of 1971 in so far as it relates to the ornaments could be only by way or a greater caution, because Explanation 1 tries to included the gold or silver or other metal ornaments set with precious stones as jewellery, which de hors the said definition, could not have been, undoubtedly, articles other than jewellery. It has been strenuously urged on behalf of the assessee that the legislature has given an inclusive definition to the term 'jewellery' by Explanation 1, and has made it applicable prospectively from April 1, 1972, and the word, 'includes' as given in the Explanation 1 by the legislature should be considered a term of extension and that it tries to bring within its sweep those articles which could not have been included otherwise. In Stroud's Judicial Dictionary, 2nd edition, at page 945, we find the following observation dealing with the expression 'include' and it has been pointed out as under :

''Include' is very generally used in interpretation clauses in order to enlarge the meaning of words or phrases occurring in the body of the statute; and when it is so used, these words or phrases must be construed as comprehending, not only such things as they signify according to their natural import but also those things which the interpretation clause declares that they shall include.'

The said learned author at page 945 points out that 'shall include' is a phrase of extension and not of restrictive definition. In Craies on Statute Law (1971), seventh edition, at page 214, we find the following observation :

'An interpretation clause which extends the meaning of a word does not take away its ordinary meaning. (cf. Midland Ry. Co. v. Ambergate, etc. Ry. Co.)'

At page 215, we find the following observation :

'Sometimes a term is defined in an interpretation clause merely ex abundanti cautela, that is to say, to prevent the possibility of some common law incident relating to that term escaping notice.'

11. It was rightly contended on behalf of the assessee that 'the modern statute contains, in the form of an interpretation clause, a little dictionary of its own, in which it endeavours to define, often arbitrarily, the chief terms used, and any ambiguity in the definition of such terms can rarely be solved than by examination of the statute itself'. (Vide Craies on Statute Law, 7th edition, page 161). Though extended or artificial meanings are given in the modern statute to a particular word or a term by giving an inclusive definition, it none the less does not take away the natural import or meaning of it.

Lord Selborne in George Robinson v. Local Board for the District of Rarton-Eccles, Winton and Monton, where the court was concerned with the meaning of the term 'street' as used in section 127 of the Public Health Act, 1875, and interpreted under section 4 thereof, observed as under :

'An interpretation clause of this kind is not meant to prevent the word receiving its ordinary popular and natural sense whenever that world be properly applicable; but to enable the word as used in the Act, when there is nothing in the context or the subject-matter to the contrary, to be applied to some things to which it would not ordinarily be applicable, I look upon this portion of the interpretation clause as meaning neither more nor less than this, that the provisions contained in the Act as to streets, whether new streets or old streets, shall, unless there be something in the subject-matter and the context to the contrary, be read as applicable to these different things. It is perfectly consistent with that that they should be read as applicable, and should be applied to those things to which they in their natural sense apply and which do not require any interpretation clause to bring them in; and in the natural and popular sense of the word 'street', or the words 'new street', I should certainly understand a roadway with buildings on each side.....'

Again, in R. v. Pearce, Lush J. observed :

'.......... an interpretation clause should be used for the purpose of interpreting words which are ambiguous or equivocal, and not so as to disturb the meaning of such as are plain.'

12. In Ex parte Ferguson and Hutchinson, a question arose as to the meaning of the enactment in section 2 of the Merchant Shipping Act, 1854, that the word 'ship' shall include 'every description of vessel used in navigation not propelled by oars'. It was contended that a fishing-boat fitted with two masts and a rudder but also with four oars, was not a ship within the meaning of the Act as it was propellable by oars. Negativing this contention Blackburn J. said, 'when an Act says that certain words shall include certain things, the words must apply exclusively to that which they are to include. That is not so; the definition given of a 'ship' is in order that the word 'ship' may have a more extensive meaning and the words 'not propelled by oars' are not intended to exclude all vessels as are never propelled by oars'. The contention urged on behalf of the assessee, therefore, that this inclusive definition given by the legislature in Explanation 1 takes away the primary and obvious meaning of the term 'jewellery' is not well-founded and should be rejected.

13. The learned advocate for the revenue next contended that for purposes of the assessment years 1963-64 and 1964-65, the court is not entitled to look to the meaning given by Explanation 1 as the said Explanation was not in the statute book in the relevant assessment years and at the relevant time, because the Explanations 1 and 2 together with the two provisos are to be brought on the statute book, though by the same legislation, namely, Finance (No. 2) Act of 1971, with effect from April 1, 1972. In other words, the court is not entitled to look to the said amendments for the purposes of determination of the question referred to in this reference as for all practical purposes the said amendment seeking to add two Explanations should be deemed to have been brought on the statute book by the subsequent legislation. This contention of the revenue was contested by the assess who urged that if the submission of the revenue was right, as the meaning of the term 'jewellery' is not unequivocal, the court must refer to the interpretation clause given by the statute book with effect from April 1, 1972. In our opinion this submission of the learned advocate on behalf of the assessee is slightly misconceived. It is well-established that a subsequent Act of Parliament does not afford any useful guide in the construction of the prior Act and the subsequent Act can be resorted to for purposes of construction of the prior Act only when both the Acts deal with the same subject and the part of the prior Act sought to be construed is equivocal and capable of different constructions (vide Income-tax Officer v. Mani Ram). The court is required in interpret only when the expression or the term required to be construed is neither sufficiently clear nor precise. If the natural meaning of the term or word is sufficiently clear and precise, we do not think that any question of interpretation arises. As has been held by a Division Bench of the Bombay High Court in New Shorrock Spinning and . v. N. U. Raval :

'One safe and infallible principle of the interpretation of taxing statutes is to read the words through to see if the rule is clearly stated. If the language employed gives the rule in words of sufficient clarity and precision, no more is required to be done. In such a case the task of interpretation hardly arises. The language used by the legislature best declares its intention and must be accepted as decisive of it.'

14. We are in respectful agreement with this well-known principle of interpretation enunciated by the Bombay High Court. Mr. Shah, therefore, urged that this is not a case of reference to a subsequent statute for construing a prior one.

15. The amendments which have been introduced in section 5(1)(viii) with effect from two different dates are brought on the statute book by the same legislation and, therefore, the court must not accept ordinary dictionary meaning of the term 'jewellery' as the dictionaries are often delusive guides in the construction of terms used in statutes. We are afraid that Mr. Shah has lost sight of the fact that though these two amendments have been inserted in section 5(1)(viii) by the same statute, namely Finance (No. 2) Act of 1971, they are deemed to have been introduced with effect from the respective dates as prescribed in the same amending Act. If the addition of the words 'but not including jewellery' in section 5(1)(viii) is brought into effect retrospectively from April 1, 1963, and if Explanation 1 defining the term 'jewellery', so as to include ornaments of gold, silver or platinum or any other precious metal studded with precious stone or not, has been brought on the statute book prospectively with effect from April 1, 1972, we would not be justified in reading both of them amendments as if they were effective simultaneously and as if both of them were parts of the statute at the same time. It would be clearly against the legislative intent which is apparently to bring the two amendments on the statute book with effect from the different dates. We, therefore, cannot escape the conclusion that Explanation 1 to section 5(1)(viii) of the aforesaid Act having come into force only with effect from April 1, 1972, cannot be considered as on the statute book in the relevant assessment years and for all intents and purposes it would be a reference to a later Act of Parliament, and as the natural meaning of the term 'jewellery', as stated above, is clear and precise, we do not think we would be justified in considering Explanation 1 for construing the term 'jewellery' for purposes of the relevant assessment years. It is no doubt true that dictionaries are not authoritative exponents of the terms used in a statute by Parliament. However, as Lord Coleridge said in R. v. Peters :

'..... dictionaries are not to be taken as authoritative exponents of the meanings of words used in Acts of Parliament, but it is a well-known rule of court of law that words should be taken to be used in their ordinary sense, and we are, therefore, sent for instruction to these books.'

Again, Cozens-Hardy M. R. said in Camden Marquis v. Inland Revenue Commissioners :

'It is for the court to interpret the statute as best it may. In so doing the court may no doubt assist themselves in the discharge of their duty by any literary held they can find, including of course the consultation of standard authors and reference to well-known and authoritative dictionaries.'

16. As stated above, the dictionary meaning of the term 'jewellery' is clear enough to include ornaments irrespective of their precious metal. It has been so recognized by a Division Bench of the Gujarat High Court in Commissioner of Wealth-tax v. Mrs. Arundhati Balkrishna, that 'jewellery' includes ornaments. Mr. Shah has, therefore, attempted to persuade us that the word 'includes' used in the Explanation 1 is equivalent to 'means and includes' and it affords an exhaustive explanation of the meaning which must be invariably attached to the word 'jewellery' for purposes of assessment in the relevant years. He relied on the decision of the Supreme Court in Smt. Ujjam Bai v. State of Uttar Pradesh, where the following observations of Lord Waston in Dilworth v. Commissioner of Stamps were quoted with approval :

'The word 'included' is very generally used in interpretation clauses in order to enlarge the meaning of words or phrases occurring in the body of the statute; and when it is so used these words or phrases must be construed as comprenending, not only such things as they signify according to their natural import but also those things which the interpretation clause declares that they shall include. But the word 'include' is susceptible of another construction, which may become imperative, if the context of the Act is sufficient to show that it was not merely employed for the purpose of adding to the natural significance of the words or expressions defined. It may be equivalent to 'mean and include' and in that case it may afford an exhaustive explanation of the meaning which, for the purposes of the Act, must invariably be attached to these words or expression.'

17. Mr. Shah may be right that in a given context the word 'include' might import that the enumeration is exhaustive. In the ultimate analysis, however, it is always the question of legislative intent and we are of the opinion that having regard to the obvious fact that gold, silver or platinum ornaments studded with jewels could not have been articles, otherwise than of Jewellery, Parliament could have only by way of abundant caution thought fit to include the same articles in jewellery by Explanation 1, which has been made effective prospectively. The parliamentary exposition of the term 'jewellery' so as to include ornaments studded with jewels could not have been in our opinion, for purposes of enlarging the term of the meaning for the first time, and therefore, to make it applicable prospectively. The interpretation canvassed on behalf of the assessee would defeat the legislative intent of removing with retrospective effect from April 1, 1963, the cover of exemption to jewellery by excluding it from articles intended for personal use of an assessee, because on that interpretation advanced by Mr. Shah the ornaments made of gold, etc., and studded with precious stones would be considered jewellery only from April 1, 1972. The result would be patently absurd, inasmuch as the articles admittedly of jewellery can be included in the net wealth of an assessee only from April 1, 1972. We cannot accept any such interpretation which would lead to such absurd result when the intention of Parliament in excluding the jewellery from the purview of exemption under section 5(1)(viii) with effect from April 1, 1963, is manifestly clear in the Finance (No. 2) Act, of 1971. As stated by us, it is only by way of greater caution that the ornaments of gold, etc., have been also included along with the other articles such as furniture, apparel, etc., studded or sewn with jewels which could not have been also included along with the other articles such as furniture, apparel, etc., studded or sewn with jewels which could not have been obviously termed as jewellery but for the inclusive definition given in Explanation 1 and to that extent the said Explanation is prospective. In that view of the matter, therefore, the last contention of Mr. Shah, therefore, ultimately urged that when two reasonably possible interpretations are open, the court should prefer one which would be favourable to the assessee. In our opinion, the question of preference does not arise as the interpretation canvassed on behalf of the assessee cannot be said to be reasonable or possible interpretation.

The result is that we allow the reference so far as assessment years 1963-64 and 1964-65 are concerned and reject it as regards assessment year 1962-63 is concerned. We, therefore, answer the first question as under :

'On the facts and in the circumstances of the case, jewellery including gold ornaments would not be entitleed to exemption under section 5(1)(viii) for assessment years 1963-64 and 1964-65. They would be entitled to exemption only for assessment year 1962-63.'

As far as the second question was concerned, Mr. Kaji has not pressed the same. We, therefore, answer it as under :

'On the facts and in the circumstances of the case the assessee is entitled to deduction in respect of tax as finally determined on assessment'.

18. Having regard to the fact that this was a question of interpretation of a clause, we think that there should be no order as to costs.


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