TaxTMI 
TaxTMI 
2009 (8) TMI 751
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....a sum of Rs. 42 lakhs for relinquishing his life membership and secretary ship in Jayanagar Education Society. On verification by the authorities it was found that the Jayanagar Education Society, Bangalore had been started during 1966-67 and was running primary and high school at No. 27/2, II Main, VII Block east Jayanagar, Bangalore and the assessee was the founder life member and was also secretary of the said society during 1996-97. The assessee had also worked as the head master in the institution till the date of his superannuation in 1991. 3. It was also noticed by the authorities that during 1996-97 the management of the society was taken over by Dr. K. R. Paramahamsa, chairman of Paramahamsa Foundation (R) Trust,Bangalore. The above said Jayanagar Education Society is having Kannada medium school and this institution was and is being run on the land provided by the Bangalore Development Authority. 4. During the course of search proceedings as the assessee had admitted that he had received a sum of Rs. 42 lakhs from the above said Dr. K. R. Paramahamsa and in response to the notice issued by the authorities under section 158BC the assessee filed block return....
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....he first appellate authority who had confirmed the finding of the Assessing Officer. 8. Aggrieved by the same, the Revenue has filed the present appeal by raising the following substantial questions of law : "Whether the Tribunal is correct in holding that the amount received by the assessee for relinquishing his life membership and secretary ship of the Jayanagar Education Society which he had founded and had been running for the past 31 years was nothing but a compensation received and should be treated as capital in nature and cannot be brought to tax under the head Income from other sources ?" 9. We have heard Sri M. V. Seshachala, learned senior standing counsel for the Department and Sri Parthasarathi, learned counsel appearing for the assessee and we have perused the orders of both the appellate authorities, the assessment order as also the statement given by the assessee under section 132(4) before the authorities on July 14, 2000, July 24, 2000, July 17, 2002 and the cross examination of the assessee dated July 17, 2002 and our finding on the said substantial question of law raised hereinabove is in the affirmative for the following reasons. ....
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....eceipt is directly referable to the profession/avocation and relied upon the judgment in P. Krishna Menon v. CIT [1959] 35 ITR 48 (SC) wherein it had been held that teaching is an avocation if not a profession and teaching "Vedanta" is just as much teaching as any other teaching and therefore an avocation and on this premise granted the relief to the assessee. 11. Sri M. V. Seshachala contends that the authorities/citations referred to and relied upon by the Tribunal are not applicable and relevant for the purpose of the present set of facts. He further contends the receipt is not in the nature of capital receipt as admittedly money was not received for transfer of any capital asset and the assessee himself claims that the said amount was received for relinquishing the life membership and secretary ship of the society and hence it has to be treated as revenue receipt. It is also contended that the assessee himself had volunteered that it is undisclosed income, in his statement given under section 132(4). In the statement datedJuly 14, 2000the respondent has not specified or has come out with the actual amount he received. In fact he admits in the statement datedJuly 14, 200....
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.... as money paid towards rendition of any services (ii) In the instant case the money was paid by a third person namely Dr. K. R. Paramahamsa to induce the assessee to give up the secretary ship or life membership. Hence the citation above referred to relied upon by the learned counsel for the respondent is inapplicable to the facts of the present case. 14. Sri Parthasarathi, learned counsel for the respondent-assessee would draw our attention to the question framed by the Revenue for determination which is only as to the nature of the receipt by the assessee which is by way of compensation received for giving up the secretary ship and life membership of the assessee-society which is to be considered and not as a case of undisclosed income of the assessee. In this regard Sri Parthasarathy relies upon the following decisions: (1) Duff (H. M. Inspector of Taxes) v. Barlow [1942] 10 ITR (E. C.) 157 (KB) ; (2) W. A. Guff v. CIT [1957] 31 ITR 826 (Bom) ; (3) H. S. Captain v. CIT [1959] 36 ITR 84 (Bom) ; (4) CIT v. Vazir Sultan and Sons [1959] 36 ITR 175 (SC) ; (5) CIT v. E. D. Sheppard [1963] 48 ITR SC 237 ; (6) Lal Chand Gopal Das ....