9911796707
TMI Blog1982 (5) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... AC erred in treating the loss incurred in wagering in horse-races as expenditure allowable u/s 57(iii) of the IT Act, 1961 and consequently directing the ITO to allow such expenditure against the profits of stake and prize money earned by the assessee in the activity of owning and maintaining of race-horses. 3. In the cross-objection filed by the assessee, the following grounds are urged by the assessee: (1) The AAC erred in not treating the income from horse-racing, betting on horses as income for profession and has further erred in placing the same under the head of 'ther sources' (2) The AAC has not allowed depreciation on the horses maintained by High Court for race and has also not treated horses as capital asset. 4. The brief ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ght to have been allowed as a deduction from his income. After hearing the ld. Counsel for the assessee, the AAC rejected the contention of the assessee that the aforesaid income is to be assessed under the head business or profession. He gave finding that the aforesaid income falls within the definition of cl. (I-b) of sub-s. 2 of s. 56. It is an income to be assessed under the head income from other sources. Coming to the question of disallowance of wagering loss, he dis-agreed with the finding of ITO and held that the assessee is entitled to deduction of wagering loss u/s 57 (iii). He further came to the conclusion that in view of the finding given by him that the aforesaid income is to be assessed u/cl (i-b) of sub-s. 2 of s. 56, gave r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case, it was the intention of the assessee to carry on the profession of betting on the horses in the races. As has been stated earlier, the assessee had earned income/loss at the racecourse activities. He did not have any other earned income. This very clearly showed that the assessee had no other profession. He further submitted that the ITO has proceeded on the basis of conjectures and surmises. The assessee was not an ordinary goer to the race course who betted on the horses as part time or hobby but he did so as professional punter. He did not do any other activity than owning and maintaining horses an betting on the horses during the season. All the aforesaid facts and circumstances of the case will go to prove beyond doubt that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g from horse by persons who actually go to the horse races and income by betting on the horse-races. In the case before us, the assessee, as pointed out by the ld. Counsel for the assessee, was a professional punter. He not only merely bets on the horse but actually goes to the race-course and is maintaining the horses and betting on them in the season which form a part of his business. On appreciation of facts and material on record, we are of the opinion that the assessee cannot be taken as a casual visitor to the race-course but is a professional punter who bets on the horses maintained by him. We can take support of the aforesaid proposition from the decision of the Karnataka High Court in the case of Mysore Sales International Ltd. vs. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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