Taxability of awards for sportsmen-Clarification regarding - Income Tax - 447/1986

Taxability of awards for sportsmen-Clarification regarding Circular No.447 Dated 22/1/1986 The Central Board of Direct Taxes had occasion to consider the question whether the award received by a sportsman, who is not a professional, will be taxable in his hands or not. In the case of a sportsman who is a professional, the award received by him will be in the nature of a benefit in exercise of his profession and, therefore, will be liable to tax under the provisions of the Income-tax Act. However, in the case of a non-professional, the award received by him will be in the nature of a gift and/or personal testimonial. 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. The question whether a sportsman is a professional or not will depend upon the facts and circumstances of each case to be decided by the assessing officer. 2. In cases where such receipt is in the nature of gift, the chargeability to gift-tax will be considered separately. 3. Hindi version will follow. (Sd.) R.K. Tewari, Under Secretary, Central Board of Direct Taxes.