Wealth-tax exemption for plain gold and silver ornaments upheld under the pre-amendment meaning of jewellery.

Gold or silver ornaments without precious or semi-precious stones were treated as outside the scope of "jewellery" under section 5(1)(viii) of the Wealth-tax Act for the assessment years 1970-71 and 1971-72, because the pre-amendment position did not cover such ornaments. The Tribunal followed the binding Orissa High Court view and held that the retrospective insertion of Explanation I by the Finance Act (No. 2) of 1971 did not change the position for those years. The ornaments were therefore excluded from taxable wealth.

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Issues: Whether gold or silver ornaments without precious or semi-precious stones embedded on them were exempt from inclusion in taxable wealth under section 5(1)(viii) of the Wealth-tax Act, 1957 for the assessment years 1970-71 and 1971-72, notwithstanding the Explanation inserted by the Finance Act (No. 2) of 1971 with retrospective effect.

Analysis: The Tribunal held that, for the period prior to the amendment and insertion of Explanation I, the expression "jewellery" in section 5(1)(viii) did not include gold ornaments that had no precious or semi-precious stones embedded on them. It followed the binding view of the Orissa High Court on the same question and accepted that the retrospective amendment did not alter the position for the years in question.

Conclusion: The ornaments were not liable to be included in the assessee's taxable wealth, and the exclusion directed by the appellate authority was upheld.

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