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TMI Blog1991 (9) TMI 142X X X X Extracts X X X X X X X X Extracts X X X X ..... (Coronation Bumper) Lottery. After some time, they came to an understanding that if any one or more tickets is declared as won, the proceeds of such a winning ticket or tickets should be shared by all the 23 persons as if all the 23 tickets have won the lottery. In the draw held on 16-6-1983, one of the tickets purchased by this group of persons won the first prize. The gross prize amount was Rs. 83 lakhs and after deducting 15 per cent in terms of the conditions laid down for the lottery, the balance prize amount due was Rs. 70,47,810. This amount was, shared equally by all the persons and thus each person got Rs. 3,06,426. On 5-4-1984, a notice under Section 139(2) read with Section 175 was issued on Shri Sundaramurty and others treating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner (Appeals) after distinguishing the decision of the Madras High Court in the case of N.P. Saraswathi Ammal and following the ratio of the decision of the Andhra Pradesh High Court in the case of Deccan Wine & General Stores v. CIT [1977] 106 ITR 111 had reached the conclusion that there is no justification for assessing the 23 persons referred to above in the status of "Body of Individuals" and he accordingly cancelled the assessments made in the status of "Body of Individuals". 3. In the present appeals, the learned Departmental Representative submitted that the Commissioner (Appeals) has erred in holding that the prize money of Rs. 70 lakhs won by the assessee and 22 others should not be assessed in the status of "Body of In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the question that arises for consideration is whether the status of the assessees is to be taken as a "Body of Individuals" or all the 23 members of this group are to be assessed separately in their capacity as "Individuals". 5. In support of the Revenue's contention, namely, that the assessees in question would constitute a "Body of Individuals", reliance was placed on the decision of the Madras High Court in the case of N.P. Saraswathi Ammal and, therefore, we consider that case in the first instance. The term "Body of Individual", of course, according to the ratio of the Madras High Court, cannot be equated to that of an A.O.P. The Court further held that the concept of "Body of Individuals" excludes the crucial characteristics of an A. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of individuals in that case who carried on the business constituted a 'Body of Individuals'. In the case under consideration the assessees merely purchased the lottery tickets and did nothing further till the results were declared. Buying of a lottery ticket and waiting for its results is not the same thing as a group of individuals receiving a live business undertaking and carrying on some activity with a view to earn income. In other words, the live business involves a series of transactions carried on either by one or more members of the group whereas in the present case, nothing of the sort was involved. Thus, on facts, the present case is distinguishable from N.P. Saraswathy Ammal's case relied on by the revenue and hence the ratio of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f individuals that the Income-tax Act is concerned and again the words 'body of individuals' derive colour from the context in which they occur, namely, an 'association of persons'." 9. From the aforementioned decisions, it is clear that in order to constitute a "body of individuals", the essential requisites are that (i) there should be a group of individuals, (ii) they should come together involuntarily, and (iii) they should carry on the same activity with a view to earn income or profits or gains. 10. In the present case, the group of 23 individuals purchased 23 lottery tickets and thereafter came together by virtue of the understanding reached between them to the effect that they should share the prize money, if won, equally amongst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rely purchased the lottery tickets came together voluntarily and did not carry on any activity with a view to earn income, would constitute a "body of individuals". On the other hand, after purchasing the lottery tickets, all of the assessees held them as co-owners and when fortune smiled on them, they shared the prize money equally. To put it differently, the assessee in the present case have received the prize money as co-owners as in the case of co-heirs inheriting their share in the property and not as a "body of individuals". The same view was taken by the Commissioner of Income-tax (Appeals) and we, therefore, do not see any reason to interfere with his order.
12. In the result, these appeals are dismissed X X X X Extracts X X X X X X X X Extracts X X X X
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