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TMI Blog2013 (8) TMI 56X X X X Extracts X X X X X X X X Extracts X X X X ..... man who is not a professional sportsman has won the gold medal for the first time after 60 years of independence of the country and he has been given the awards/rewards/prizes mainly by various governments, local authorities, trusts and institutions and of course some corporate/individuals, a liberal construction of Circular No.447 is required. Considering the facts of the case and the nature and spirit of Circular No.447, we hold that in the case of the assessee, viz., Shri Abhinav Bindra, all the rewards/prizes/gifts received by him are covered by Circular No.447 dated 22nd January, 1986 and, therefore, should not be treated as income in his hands. - Decided in favour of assessee. - IT Appeal no. 2219 (Delhi) of 2013 - - - Dated:- 26-7-2013 - G.D. AGRAWAL AND R.P.TOLANI, JJ. For the Appellant : Ashwani Kumar. For the Respondent : Bhim Singh. ORDER:- G.D. Agrawal, Vice-President - This appeal by the assessee is directed against the order of learned CIT(A)-I, Dehradun dated 21st February, 2013 for the Assessment Year 2009-10. 2. The assessee has raised the following grounds of appeal:- "1. That order passed u/s 250(6) of the Income Tax Act, 1961 is again ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 12AA to be exempt. He, therefore, added the sum of Rs.63,10,601/- to be the income of the assessee under Section 56(2)(v). On appeal, learned CIT(A) enhanced the income by the sum of Rs.2,34,00,000/- being the awards/rewards received from various governments. Hence, this appeal by the assessee. 5. At the outset, the learned counsel for the assessee stated that the assessee is an amateur shooter and, therefore, with regard to rewards/gifts, Circular No.447 would be squarely applicable. He stated that as per the above Circular, a distinction has been made between a sportsman who is a professional sportsman or a non-professional sportsman. In the case of non-professional sportsman, the award received by him will not be in the nature of income. He stated that once as per the Board's Circular, any award received by a sportsman who is not a professional is not income. The question of applicability of Section 10(17A) or 56(2)(v) will not arise because the receipt is not the income under Section 2(24) of the IT Act. Section 10 is applicable in respect of income which does not form part of the total income. Similarly, Section 56 is applicable in respect of income from other sources. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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." 9. From the above Circular, it is evident that the CBDT has distinguished between the sportsman who is a professional or who is not a professional. In the case of a professional sportsman, the award received by him will be in the nature of benefit in exercise of his profession and therefore will be liable to tax under the provisions of the Income-tax Act. But, in the case of a non-profe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... viz., Shri Abhinav Bindra is a professional sportsman. Therefore, we agree with the contention of the learned counsel that the assessee is an amateur sportsman and not a professional sportsman. 11. Now, the second question would be whether the above Circular still holds goof after the amendment in Section 10(17A) and insertion of Section 56(2)(v). It has been stated by the learned counsel that the above Circular has not been withdrawn so far despite the amendment in Section 10(17A) as well as insertion of Section 56(2)(v). This statement made at the bar has not been controverted by the Revenue. Therefore, we proceed with the belief that the above Circular has not been withdrawn. As we have already stated that as per Circular No.447, in the case of a non-professional sportsman, the award received by him will be in the nature of a gift and/or personal testimonial which will not be liable to tax in his hands as it would not be in the nature of income. The learned DR has contended that the above Circular would not be applicable after the modification of Section 10(17A) and 56(2)(v). So far as Section 10 is concerned, this is Chapter III which begins with the heading "Incomes which d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... family from any person on or after the 1st day of September, 2004 36[but before the 1st day of April, 2006], the whole 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 (g) from any trust or institution registered under section 12AA.] Explanation.-For the purposes of this clause, "relative" means- (i) spouse of the individual; (ii) brother or sister of the individual; (iii) brother or sister of the spouse of the individual; (iv) brother or sister of either of the parents of the individual; (v) any lineal ascendant or descendant of the individual; (vi) any lineal ascendant or descendant of the spouse of the indi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or a consideration which is less than the stamp duty value of the property by an amount exceeding fifty thousand rupees, the stamp duty value of such property as exceeds such consideration: Provided that where the date of the agreement fixing the amount of consideration for the transfer of immovable property and the date of registration are not the same, the stamp duty value on the date of the agreement may be taken for the purposes of this sub-clause: Provided further that the said proviso shall apply only in a case where the amount of consideration referred to therein, or a part thereof, has been paid by any mode other than cash on or before the date of the agreement for the transfer of such immovable property; (c) any property, other than immovable property,- (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 wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the spouse of the individual; (G) spouse of the person referred to in items (B) to (F); and (ii) in case of a Hindu undivided family, any member thereof;] (f) "stamp duty value" means the value adopted or assessed or assessable by any authority of the Central Government or a State Government for the purpose of payment of stamp duty in respect of an immovable property;] [(viia) where 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 transactio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fied under the following heads of income :- A. - Salaries. B. - [***] C. - Income from house property. D. - Profits and gains of business or profession. 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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