Judgment:
ORDER
N.V. Balasubramanian, J.
1. At the instance of the assessee, the Tribunal, Madras 'A' Bench, Madras, has referred the following questions of law for our consideration under s. 27(1) of the WT Act (hereinafter called 'the Act') :
'(1) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that cups and trophies are not exempt under the WT Act
(2) Whether the Tribunal was right in law in not extending the tenor of 'works of art', coming in the provisions of s. 5(1)(xii) of the WT Act, to the cups and trophies ?'
2. The assessee is an individual and filed the WT returns for the asst. yr. 1978-79, on 5th January, 1979. A revised return was also filed subsequently. It appears that there was a search on 20th January, 1981 in the premises of the assessee and in his native place at Kanadukathan. During the course of search it was found that there were silver articles weighing about 150 to 200 kgs. which were not properly explained. The assessee claimed that out of the said quantity, 73.850 kgs. belonged to the assessee, that the assessee had converted trophies weighing 95.310 kgs. into silver articles and in the process obtained 75.310 kgs. after conversion. The assessee claimed that the trophies should be regarded as works of art within the meaning of s. 5(1)(xii) of the Act, and they are exempted under the said provisions. The WTO found that the provisions of s. 5(1)(xii) of the Act did not apply as the trophies cannot be regarded as works of art, as they really represented the prize money received in kind and in that view he rejected the claim for exemption preferred by the assessee. On appeal, by the assessee, the AAC found that the assessee had sold or exchanged the silver articles and the trophies and cups cannot be regarded as 'works of art' and further there was an intention to sell the article and, therefore, the assessee was not entitled to claim exemption under s. 5(1)(xii) of the Act and the inclusion of the value of trophies was correct.
3. The assessee carried the matter in further appeal to the Tribunal. The Tribunal found that the assessee won cups and trophies in several races and in the cups and trophies there were silver contents and they were valuable articles. Before the Tribunal, the assessee produced samples of trophies and cups and the Tribunal on inspection of the cups and trophies held that the articles carry engraved markings of the occasion and events in which the cups or trophies were won and they cannot be regarded as works of art. The Tribunal also held that the fact that some of the cups and trophies were subsequently converted into basic metal and some of them were sold may not necessarily indicate that they were intended for sale. However, the Tribunal found that the trophies cannot be regarded as works of art and therefore, the assessee was not entitled to claim exemption as aforesaid. In this view of the matter, the Tribunal dismissed the appeal preferred by the assessee.
4. Mr. P. P. S. Janarthana Raja, learned counsel for the assessee, vehemently contended that the Tribunal was not correct in holding that the cups and trophies cannot be regarded as 'works of art' and submitted that in the process of making cups and trophies there is an element of human skill involved in making cups and trophies and, therefore, the trophies should be regarded as works of art within the meaning of s. 5(1)(xii) of the Act. Mr. C. V. Rajan, learned junior standing counsel for the Revenue, fairly submitted that the finding of the Tribunal is that silver articles cannot be regarded as works of art and that finding was arrived at by on the inspection of the samples of the articles produced by the assessee and in view of the specific finding of the Tribunal the trophies cannot be regarded as works of art.
5. We have carefully considered the submissions of the learned counsel for the parties. Sec. 5 of the WT Act provides that wealth-tax should not be payable in respect of the assets mentioned in various sub-clauses. Sub-cl. (xii) of cl. (1) of s. 5 of the WT Act reads as under :
'any works of art, archaeological, scientific or art collections, books or manuscripts belonging to the assessee and not intended for sale;'
The expression 'works of art' is not a term of art, however, its meaning has to be construed in the context of the provisions of s. 5(1)(xii) of the Act and the expression 'works of art' is employed along with other expressions like archaeological, scientific or art collections, books or manuscripts belonging to the assessee. Therefore, there must be an element of human skill involved or applied in the manufacture of the product which on a mere look up it can be regarded as works of art. In Halsbury's Laws of England Fourth Edition in paragraph No. 892 the expression 'works of art' is defined as follows :
'Works of art' applies to paintings, drawings and pastels executed by hand, original engravings prints and lithographs, and original sculptures and statuary in any material'.
In Sampath Iyengar's The Three New Taxes, the expression and term 'works of art' (at p. 388) is as under :
'Works of art are those which are the result of human skill applied in various directions, such as, sculptures by Michael Angelo, paintings by Raphael, Ruben, Vandyke, Leonardo de Vinci, Potticelli, Rembrandt, etc., or portraits by Ravi Varma, etc. Leading examples of private art collections in India but to which public entry is permitted are :
'(1) the Collections of Sir Salar Jang situate in Hyderabad,
(2) the Mullick Art collections at Calcutta,
(3) the Vizianagaram Collections at Varanasi, and
(4) the Singhania Collections at 'The Retreat', Kanpur' '.
A reading of the above two extracts clearly shows that there must be an element of human skill employed in the making of the article and the result of human skill should be apparent in the article to regard them as works of art. It is not every article which is manufactured manually that can be regarded as works of art and there must be some artistic innovation which would turn them as works of art. The Tribunal on inspection of trophies and cups came to the conclusion that the said trophies carry certain engraved markings of the occasion and events in which the assessee won the cups and trophies and there was no human skill applied on the said trophies or cups. Since the Tribunal has come to the above conclusion on the visual inspection of the samples of articles produced before it, we are not in a position to accept the argument of the learned counsel for the assessee that the cups and trophies of the assessee should be regarded as works of art. We are of the view that the findings recorded by the Tribunal is a finding recorded on examination of the materials and the findings should be regarded as a finding of fact. The assessee has not established that there was human skill employed which made the articles to be regarded as works of art. Therefore, in view of the specific finding of the Tribunal on the cups and trophies won by the assessee in the horse races, we are of the view that the articles cannot be regarded as works of art and the Tribunal was right in holding that the assessee is not entitled to claim exemption under s. 5(1)(xii) of the Act. Hence, we are of the view that both the questions of law are liable to be answered against the assessee.
6. Accordingly, we answer both the questions in the affirmative and against the assessee. However, in the circumstances of the case, there will be no order as to costs.