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Issues involved: Determination of whether the surplus remaining with the assessee after disbursement of mass stipends constitutes income in the hands of the assessee for the assessment years 1974-75 and 1975-76.
Summary: The High Court of Kerala addressed the issue of whether the surplus remaining with the assessee, a priest at St. Joseph's Monastery, Mannanam, after distributing mass stipends, should be considered as income. The Income-tax Appellate Tribunal held that the surplus amounts were indeed the income of the assessee for the respective years. The assessee contended that the remittances received were voluntary and casual, not necessarily constituting income. The Tribunal referred the legal question to the High Court for decision. The Court examined the nature of the remittances and the legal provisions related to income. It noted that the definition of "income" under section 2(24) of the Income-tax Act is inclusive and wide-ranging. The Court also considered section 10(3) which excludes casual and non-recurring receipts unless they arise from a profession or occupation. The Court referred to precedents and legal texts to establish that voluntary payments connected to one's occupation or vocation are considered income. The Court emphasized that the remittances received by the priest were linked to his vocation as a clergyman, making them income. It cited previous Supreme Court decisions to support its interpretation. The Court concluded that the surplus remaining with the assessee from mass stipends constituted his income. The legal question was answered in favor of the Revenue, and the judgment was to be communicated to the Income-tax Appellate Tribunal, Cochin Bench.
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