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TMI Blog1995 (1) TMI 121X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1987, as an incentive lucky prize awarded to the investors for National Savings Scheme 1986, from the Government of Kerala. The cost of this car was Rs. 81,728.30. The assessee did not disclose the value of this car as his income. Hence, the AO invoked the provisions of s. 143(2)(b) of the Act and completed the assessment under s. 143(3) r/w s. 143(2)(b) on 27th June, 1990, bringing the amount of Rs. 81,728 to tax as income under the head 'Other sources'. Subsequently the AO invoked the rectification proceedings under s. 154 of the Act and held that w.e.f. 1st April, 1987, a new s. 115BB has been inserted in the Act for taxing such winnings from lotteries at a flat rate of tax at 40%. Thus he calculated the tax at a flat rate of 40% on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Lotteries (1992) 103 CTR (Ker) 289 : (1993) 199 ITR 266 (Ker) wherein it is held that winnings from lotteries in kind are also to be considered as income holding that the definition of 'income' included not only money payment but also the value of any benefit or perquisite whether convertible into money or not. It was also noticed by the AO that the assessee purchased a Deluxe Maruti car costing Rs. 1,14,833.60 instead of the lucky prize of ordinary Maruti car costing Rs. 81,828.30. The difference in the prize of Rs. 33,105.30 was paid by the assessee. Therefore, the value of the lucky prize has been converted into money's worth and handed over to the assessee. The assessee has not mentioned about the winning from lottery in Part 1, page 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is also not assessable in the asst. yr. 1988-89. The date of invoice of Popular Vehicles Services Ltd. bearing No. 2701-80025CD for the Maruti car and delivery of the same was on 21st April, 1988, in which case the income is assessable in the asst. yr. 1989-90 and not in the asst. yr. 1988-89, in relation to which the penalty has been levied. 5. Further whether the winning in kind from lottery would constitute income (Maruti car as a prize) was settled by the decision of the Kerala High Court in the case of K.C. Suresh vs. Director of Lotteries Ors. only on 21st Feb., 1992. Therefore, there is force in the contention of Shri Kesavan that the assessee was under the bona fide impression that the Maruti car received by the assessee wa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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