9911796707
TMI Blog1969 (3) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... he deed itself this plot of land was valued at Rs. 40,000 for purposes of stamp duty. The Income-tax Officer held that the acquired the said piece of land by exercising his profession of preaching the religious cult in question to the donor. According to the Income-tax Office the value of the land should, therefore, be taken as the assessee's professional receipt and was taxable as the assessee's income in the accounting year 1957-58. The Income-tax Officer's estimate of the value of the property was Rs. 60,000 and he included this sum in the assessee's total income for the assessment year 1958-59. The Appellate Assistant Commissioner said that in view of the declared intention of the donor as expressed in the deed of gift, the gift must be held to be related to the profession carried on by the assessee. The Appellate Assistant Commissioner upheld the decision of the Income-tax Officer. Before the Tribunal the assessee contended that the donor was not his disciple, but was the disciple of his father. The gift, therefore, according to the assessee, was made by the donor to the assessee, who was her guru bhai, out of natural love and affection and was not a receipt in the carry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the exercise of a profession, vocation or occupation, which are of a casual and non-recurring nature or are not by way of addition to the remuneration of an employee, shall not be included in the total income of the person receiving them. In other words, for our purposes in this reference, if the receipt in question is a receipt which arises from the exercise of a profession, vocation or occupation, it does not enjoy the exemption envisaged by section 4(3)(vii). With these provisions in view, we have to examine the recitals in the deed of gift, dated the 6th December, 1957, which have not been challenged in this reference. Indeed, the Tribunal has considered these recitals to arrive at its finding of facts. The recitals, inter alia, run as follows : " And, whereas the donee who is the eldest son of the said Sri Sri Thakur Anukul Chandra, is a religious preacher of the said cult enunciated by the said Sri Sri Thakur Anukul Chandra. And, whereas the donee by the preaching of the said religious cult to the donor for some years past has administered to the mental enlightenment and spiritual benefit of the donor which has brought about a complete change in her outlook of life. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsidered. For instance, in the case of Cooper v. Blakiston, Lord Loreburn L.C. observed : " .........where a sum of money is given to an incumbent substantially in respect of his services as incumbent, it accrues to him by reason of his office......Had it been a gift of an exceptional kind, such as a testimonial, or a contribution for a specific purpose as to provide for a holiday or a subscription peculiarly due to the personal qualities of the particular clergyman, it might not have been a voluntary payment for services, but a mere present. " Again, in Herbert v. McQuade, Sir Richard Henn Collins M.R., as he then was, said : " ........the test is whether from the standpoint of the person who receives it, it accrues to him in virtue of his office ; if it does, it does not matter whether it was voluntary or whether it was compulsory on the part of the persons who paid it. " Applying the above principles to the facts in the present reference we find, (a) that the assessee was a preacher of the Satsang cult ; (b) the gift of land may have been made to the assessee voluntarily but it was made in consideration of certain spiritual benefits that the donor had received from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing from a vocation they were not casual or non-recurring receipts and no question of exemption under section 4(3)(vii) of the Indian Income-tax Act arose. " The Supreme Court observed further that in order that a payment may be exempted under section 4(3)(vii) of the Indian Income-tax Act, as a casual and non-recurring receipt, it has to be shown that it did not arise from the exercise of a vocation. In this reference the Tribunal has correctly relied on this decision of the Supreme Court in P. Krishna Menon, v. Commissioner of Income-tax, for arriving at its conclusions. The assessee's vocation was the vocation of a preacher of the Satsang cult and there is no doubt that in the exercise of that vocation he received the gift of land being the subject-matter of the instant reference. We would now briefly deal with three other cases which the assessee's counsel had relied on. In Mahesh Anantrai Pattani v. Commissioner of Income-tax, the assessee was the Chief Dewan of the Bhavnagar State from December, 1937, to January 1948, when responsible Government was introduced by the Maharaja and the assessee was given a pension. On March 1, 1948, the Bhavnagar State merged in the Unite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the jewellery and amounts of money which she received in the relevant years were gifts made by the Maharani of Baroda. The Appellate Tribunal relied on (1) assessee's admission that she acted as the local agent of the Maharani for disbursing salaries to the servants of the Maharani, and (2) on a bill issued by a garage in which the assessee was described as the private secretary of the Maharani. The Tribunal observed that the assessee had failed to place before the income-tax authorities all the evidence in support of her contention that the gifts from the Maharani did not constitute her income and held that these gifts were remuneration for services rendered or to be rendered. The Supreme Court was of opinion, (1) that the Tribunal had wrongly placed the burden of proof on the assessee, and (2) the circumstances that the Tribunal relied on did not establish that what the Maharani gave to the assessee was remuneration for services rendered or to be rendered. The Supreme Court said that these gifts were not assessable to tax. In stating the law on the subject, the Supreme Court states that where the case of the assessee is that a receipt did not fall within the taxing provision, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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