COMMISSIONER OF WEALTH TAX, GUJARAT AT AHMEDABAD versus MRS. ARUNDHATI BALKRISHNA

Citation: [1970] 3 S.C.R. 819 · Decided: 25-02-1970 · Supreme Court of India · Bench: J.C. SHAH · Disposal: Dismissed

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Judgment (excerpt)

819 
.A 
COMMISSIONER OF WEALTH TAX, GUJARAT AT 
B 
c 
D 
F 
G 
JI 
AHMED ABAD 
v. 
MRS. ARUNDBATI BALKRISHNA 
February 25, 1970. 
[J. C. SHAH, K. S. HEGDE AND A. N. GROVER, JJ.] 
Wealth Tax Act (27 of 1957), ss. 1(e) (iv) and 5(1)(vii)-Receipt of 
share from trust funds-When 'annuity'-Jewellery intended for personal 
use-Whether exempt. 
The assessee was an individual. 
She was entitled for her life, to an 
aUquot share of the income arising from the funds settled on trust by three 
trust deeds and received payments of such share. 
She also possessed 
jewellery, intended for her personal use, of the value of Rs. 80,000. 
On the questions : ( 1) whether the payments to the assessee were 
annuities falling within the scope of s. 2(e)(iv) of the Wealth Tax Act, 
1957, whose value could not be included in the computation of her net 
wealth; and (2) whether the value of the jewels was exempt under 
s. 5(1)(viii). 
HELD: (1) Under the trust deeds, the assessee was not entitled to 
any fixed sum of money. Therefore, the payments to the assessee under 
the trust deeds could not be considered as annuities and hence, she was 
not entitled ·to the benefit of s. 2(e)(iv). [824 B-F] 
. Ahmed G H. Arifj v. Commissioner of Wealth Tax, Calcutta, [1970] 
2 S.C.R. 19 followed Commissioner of Wealth Tax v. Mr3, 
Dorothy 
Martin, (1968) 60 I.T.R. 586, approved, 
(2) Under. s. 5 there are four provision• dealing with jewellery, name-
ly, 
(a) 
jewellery intended for 
the personal use of the assessee-
•· 5(1) (viii}, (b) 
jewellery which forms an heir loom-s. 5(1) (xiii), 
(c) jewellery in the possession of any ruler-s. 5(1) (xiv); and 
(d) 
jewellery in general-s. 5(1)(xv), Under s. 5(1)(xv), as it stood 
in 
1958-59, every assessee was entitled to deduct a sum of Rs. 25,000 from 
out di the value of the jewellery whether the same was intended for per-
sonal use or not; but under s. 5 (I) (viii) the value of all the jewellery in-
tended for the personal use. of the assessee stands excluded in the compu-
tation of the net wealth Of an assessee. 
Therefore, the jewellery in 
the 
present case is exempt under s. S(l)(viii). [825 D, E-G] 
CIVIL APPELLATE JURISDICTION : Civil Appeals Nos. 
1991 
1992, 2010 and 2011 of 1968. 
Appeals from the judgment and order dated October 9, 1967 
of the Gujarat High Court in Wealth Tax Reference No. 3 of 
1964. 
B. Sen, S. K. Aiyar and B. D. Sharma, for the appellant (in 
C. A. Nos. 1991 and 1992 of 1968) and the respondent (in 
C. As. Nos. 2010 and 2011 of 1968). 
820 
SUPREME COURT REPORTS 
[1970] 3 S.C.R. 
N. A. Palkhivala and I. N. Shroff, for the respondent (in 
A 
C. As. Nos. 1991 and 1992 of 1968) and the appellant (in 
C.As. Nos. 2010 and 2011 of 1968). 
The Judgment of the Court was delivered by 
Hegde, J. 
These appeals by certificate under s. 29 of the 
Wealth Tax Act, 1957 (to be hereinafter referred to as the Act) 
arise from a reference under s. 27(1) of the Act to the High Court 
of Gujarat. Therein four questions were referred to the High Court 
for its opinion. These four questions really gave rise to two ques-
tions of law viz. ( 1) whether under the three trust deeds referred to 
therein the assessee got annuities falling within .the scope of s. 2( e) 
(iv) ? and (2) whether the value of the jewels owned by the assessee 
was exempt under s. 5(l)(viii) in computing the net wealth of the 
assessee ? 
The asse~iee is an individual and the assessment years with 
which we are concerned in these appeals are 1957-58 and 1958-
59, the corresponding valuation dates being December 31, 1956 
and December 31, 1957. 
By a deed of settlement dated September 7, 1945 the father 
of the assessee settled certain shares of the Indian Companies of 
the estimated va.lue of R..s. 5,50,325/- upon trust for the benefit 
of his two sons and his daughter, the assessee. By another deed 
of settlement dated October 12, 1945 he settled certain other 
shares upon 
trust for the benefit of the assessee 
and her two 
brothers. 
All the terms of the two trust deeds relevant for our 
present purpose are identical. 
By a deed of settlement dated 
September 3 0, 1945, the mother-in-law 
of the assessee settled 
upon t'rust a sum of Rs. 3,88,931/- and shares of some Indian 
Companies of the aggregate market value of Rs. 11,81,670/-. 
The- assessee is one of the beneficiaries named in that deed. The 
assessee also possessed jewellery of the value of Rs. 80,000/-
As regards the payments to be ma.de to the assessee under the 

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