TaxTMI 
TaxTMI 
2013 (8) TMI 56
X X X X Extracts X X X X
X X X X Extracts X X X X
....was further not justified to arbitrarily enhance the assessed income by Rs.2,34,00,000/- received by the appellant from various Governments without giving any opportunity before taking such an action. 3. That the ld.CIT(A) gravely erred in not adjudicating on the detailed written submissions made during the course of hearing vide which it was submitted that the entire receipts received by the appellant were in the nature of capital receipts. 4. That principles of natural justice were grossly violated in as much as neither any reasonable opportunity before enhancing the income was given nor the details written submissions made, were considered while adjudicating the appeal." 3. The facts of the case are that the assessee is a sportsperson viz., shooter of international repute who won medals in various international events including Asian Games, Commonwealth Games, World Championships and also won gold medal in Olympic Games at Beijing in 2008. During the accounting year relevant to the assessment year under consideration, the assessee received awards/prizes/gifts amounting to Rs.4,81,63,380/- which were divided in four categ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....dered in ITA No.4788/Del/2003 and others. He, therefore, submitted that the entire receipt of the assessee by way of gifts/prizes/rewards should be held to be not in the nature of income. Accordingly, the addition made by the Assessing Officer as well as enhancement made by the learned CIT(A) should be deleted. 6. Learned DR, on the other hand, relied upon the order of learned CIT(A) and he stated that the Circular of the CBDT being relied upon by the learned counsel is dated 22nd January, 1986. Much water has flown thereafter and Section 10(17A) has been amended and moreover, Section 56(2)(v) has been inserted by the Finance (No.2) Act of 2004 with effect from 1st April, 2005. The assessment year under consideration is AY 2009-10 and, therefore, Section 56(2)(v) would be squarely applicable. Therefore, after the insertion of Section 56(2)(v), the Circular would not be applicable. 7. In the rejoinder, it is stated by the learned counsel that the Circular No.447 dated 22nd January, 1986 has not been withdrawn so far. If the CBDT would have opined that after the insertion of Section 56(2)(v) the Circular is not applicable, it would have been withdrawn so far because more than e....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... sportsman. We find that before the Assessing Officer, the assessee has given a detailed written submission which is reproduced in the assessment order. In the first paragraph itself, which is being reproduced below for ready reference, the assessee has claimed that he is an amateur shooter. He is pursuing it as his hobby and not as a professional sportsman :- "(1) By way of a brief background it may be mentioned that the assessee Shri Abhinav Bindra is an "Amateur" Shooter of international repute who, by virtue of his skills, honed and perfected after years of sustained hard-work, and perseverance, has brought and won medals at various international events including the Asian Games, Commonwealth Games and World Championships, the crowning glory of which has been the first individual Gold medal ever won by an Indian in the history of Olympic Games at Beijing Olympics in 2008. It is worthwhile, relevant and important to mention here that while this sport is regulated at the national level by the National Rifle Association of India (NRAI) and at the international level by the International Shooting Sports Federation (ISSF), Headquartered at Munich, Germany....
X X X X Extracts X X X X
X X X X Extracts X X X X
....cerned, it is under the heading "Income from other sources". Section 56(1) and (2) read as under:- "56. (1) Income of every kind which is not to be excluded from the total income under this Act shall be chargeable to income-tax under the head "Income from other sources", if it is not chargeable to income-tax under any of the heads specified in section 14, items A to E. (2) In particular, and without prejudice to the generality of the provisions of sub-section (1), the following incomes, shall be chargeable to income-tax under the head "Income from other sources", namely :- (i) dividends ; [(ia) income referred to in sub-clause (viii) of clause (24) of section 2 ;] [(ib) income referred to in sub-clause (ix) of clause (24) of section 2 ;] [(ic) income referred to in sub-clause (x) of clause (24) of section 2, if such income is not chargeable to income-tax under the head "Profits and gains of business or profession";] [(id) income by way of interest on securities, if the income is not charge....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... (vi) any lineal ascendant or descendant of the spouse of the individual; (vii) spouse of the person referred to in clauses (ii) to (vi);] [(vi) where any sum of money, the aggregate value of which exceeds fifty thousand rupees, is received without consideration, by an individual or a Hindu undivided family, in any previous year from any person or persons on or after the 1st day of April, 2006 39[but before the 1st day of October, 2009], the whole of the aggregate value of such sum: Provided that this clause shall not apply to any sum of money received- (a) from any relative; or (b) on the occasion of the marriage of the individual; or (c) under a will or by way of inheritance; or (d) in contemplation of death of the payer; or (e) from any local authority as defined in the Explanation to clause (20) of section 10; or (f) from any fund or foundation or university or other educational institution or hospital or other medical institution or any trust or institution referred to in clause (23C) of section 10; or ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t consideration, the aggregate fair market value of which exceeds fifty thousand rupees, the whole of the aggregate fair market value of such property; (ii) for a consideration which is less than the aggregate fair market value of the property by an amount exceeding fifty thousand rupees, the aggregate fair market value of such property as exceeds such consideration : Provided that where the stamp duty value of immovable property as referred to in sub-clause (b) is disputed by the assessee on grounds mentioned in sub-section (2) of section 50C, the Assessing Officer may refer the valuation of such property to a Valuation Officer, and the provisions of section 50C and sub-section (15) of section 155 shall, as far as may be, apply in relation to the stamp duty value of such property for the purpose of sub-clause (b) as they apply for valuation of capital asset under those sections : Provided further that this clause shall not apply to any sum of money or any property received- (a) from any relative; or (b) on the occasion of the marriage of the individual; or (c) under a will or by way of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....re a firm or a company not being a company in which the public are substantially interested, receives, in any previous year, from any person or persons, on or after the 1st day of June, 2010, any property, being shares of a company not being a company in which the public are substantially interested,- (i) without consideration, the aggregate fair market value of which exceeds fifty thousand rupees, the whole of the aggregate fair market value of such property; (ii) for a consideration which is less than the aggregate fair market value of the property by an amount exceeding fifty thousand rupees, the aggregate fair market value of such property as exceeds such consideration : Provided that this clause shall not apply to any such property received by way of a transaction not regarded as transfer under clause (via) or clause (vic) or clause (vicb) or clause (vid) or clause (vii) of section 47. Explanation.-For the purposes of this clause, "fair market value" of a property, being shares of a company not being a company in which the public are substantially interested, shall have the meaning assigned to it in the Explanatio....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... E. - Capital gains. F. - Income from other sources." 13. Thus, Section 14 provides the various heads under which income has to be computed and Item No. F which is 'income from other sources' is a residuary head i.e. the income which is not assessable under any of the other heads, viz., salary, income from house property and gains from business or profession and capital gains is to be assessed under the head 'income from other sources'. However, for applicability of Section 14 and thereafter Section 56, what is required is the receipt in the nature of income. In Circular No.447, it has been clearly stated "In view of this, it is clarified that such awards in the cases of a sportsman, who is not a professional, will not be liable to tax in his hands as it would not be in the nature of income." Therefore, as per the Circular, the receipt by way of award by a sportsman who is not a professional sportsman will not be in the nature of income. In the order of learned CIT(A), he has distinguished between the words "reward" and "award", of course with reference to Section 10(17A). We have already stated that Section 10(17A) is not applicable where the above C....