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TMI Blog1990 (3) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... candidate had to do internship in a hospital for a prescribed period. Accordingly, the assessee worked in and completed internship at the Worcester City Hospital from June, 1973, to June, 1974. It also appears that the assessee worked there for two more years. During the accounting period ending March 31, 1974, relevant for the assessment year 1974-75, the assessee had admittedly received 7,086.82, and, in the course of the assessment proceedings, the assessee claimed that the amount received from the hospital was in the nature of a stipend paid to meet the expenses in connection with the post-graduate studies and hence exempt under section 10(16) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"). The Income-tax Officer to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal, at the instance of the assessee, under section 256(1) of the Act, the following two questions of law have been referred to this court for its opinion : "(1) Whether the sum of 7,086.82 (equivalent to Rs. 50,320) received by the assessee in the course of internship in the Worcester City Hospital is income of the assessee within the meaning of the Income-tax Act, 1961 ? (2) If it is income, whether it is a scholarship granted to the assessee to meet his cost of education within the meaning of section 10(16) of the Income-tax Act, 1961 ?" Learned counsel for the assessee, strongly relying upon the decisions reported in A. Ratnakar Rao v. Addl. CIT [1981] 128 ITR 527 (Kar) and CIT v. V. K. Balachandran [1984] 147 ITR 4 (Mad), cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for a specific exclusion. The proper View to take on section 10(16) of the Act would be that a scholarship, even though income in the hands of the scholar-recipient, would not be included in the taxable total income, if it was a scholarship granted to meet the cost of education. Bearing this in mind, when we examine the precise nature of the payments received by the assessee, it is seen from annexure E styled as statement of earnings that the assessee has been shown to have been paid pay or salary. It has also been differently described as wages. The Federal and State taxes had been deducted from the payments so made. It may be that in order to fulfil one of the requirements of the Board of Internal Medicine to obtain certification in Inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... That decision has been rendered with reference to the purpose of the payment, as a scholarship amount, to pursue study and research in paediatrics. That decision cannot, therefore, be of any assistance in the present case. Likewise, in CIT v. V. K. Balachandran [1984] 147 ITR 4 (Mad), the amounts were paid to the assessee, who was, an "exchange visitor", in order to enable him to engage himself as a member in the school of mathematics for doing advanced research in the field of mathematics and to defray the expenses of his travel, study, etc., and it was under those circumstances that the grant-in-aid was held to be a scholarship to meet the assessee's education so as to fall under section 10(16) of the Act. Even that decision cannot have a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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