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Issues: Whether gold sovereigns, silver coins and silver bars sold by the assessee were "capital assets" or excluded as "personal effects" held for personal use under the Indian Income-tax Act, 1922.
Analysis: The exclusion for "personal effects" applies only to movable property held for personal use in the sense of articles intimately associated with the person of the assessee and normally, commonly or ordinarily used by him or a dependent member of his family. The statutory context, the illustrative items in the definition, and the analogous language in the Wealth-tax Act all indicate that the expression does not extend to bullion or coins merely because they were used on religious occasions or kept for ornamentation or pride of possession. The articles in question were not shown to have the requisite intimate personal connection and therefore did not fall within the exemption.
Conclusion: The assets were capital assets and not personal effects; they were liable to capital gains tax.
Ratio Decidendi: For the statutory exclusion of "personal effects" to apply, the movable property must have an intimate and ordinary personal use connected with the person of the assessee; property used merely for display, ornamentation, pride of possession, or ceremonial purposes is not excluded as personal effects.
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