MAHARAJA RANA HEMANT SINGHJI H H Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE Tribunal, Delhi Bench "A" (hereinafter called "the Tribunal"), has made this reference to this Court under s. 66(1) of the Indian IT Act, 1922 (hereinafter called "the Act"). His Highness Maharaja Udai Bhan Singhji, Ruler of Dholpur, died issueless on 22nd October, 1954. After his death, the movable property possessed by the deceased, Maharaja Udai Bhan Singhji was sealed by the Government of India. Maharaja Rana Hemant Singhji (hereinafter called "the assessee") was thereafter recognised as the successor to the deceased Maharaja and the assets which the Government of India had sealed were released and handed over to Rajmata, the guardian of the assessee. Part of the assets consisting of gold sovereigns, old silver rupee coins and silver bars were sold for Rs. 20,94,785. THE ITO, Bharatpur, while assessing the assessee for the asst. yr. 1958-59, computed Rs. 3,44,303 as capital gains on these sales taking into account the market value of the assets sold as on 1st January, 1954, as given here-under : . Quantity Sale price Rate on Cost on Sovereigns 4,825 3,33,282 56/8 2,92,612 Silver coins 7,90,440 13,01,627 136% 10,74,998

(2.) THE assessee objected to the taxation of the said amount on the ground that the various articles-sovereigns, silver coins and silver bars-were held for the personal use of the assessee and the members of his family and as such they fell within cl. (ii) of s. 2(4A) of the Act. THE ITO negatived this objection raised on behalf of the assessee. THE assessee filed an appeal before the AAC, B-Range, Jaipur, but was unsuccessful. THE assessee filed an appeal to the Tribunal. THE Tribunal also rejected the appeal.