TMI Blog1973 (7) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... ct"), at the instance of the assessee. The question referred for our determination relates to assessment years 1955-56, 1956-57, 1957-58, 1958-59 and 1959-60 for which the corresponding previous years ended on March 31 of each year respectively. The assessee, Dilip Kumar Roy, was a disciple of the late Shri Aurobindo. He utilised his talents given to him by the Divine for doing service for the Divine cause. His two main activities were singing bhajans and writing books. Some of his bhajans were recorded and he earned royalty from the same. He also earned royalty from the books. Both these receipts were charged to tax under the head "other sources". He travelled widely not only in India but round the world and sometimes gave lectures on his tour. He attracted several persons towards him, who called him their guru. The assessee had a joint account in the name of himself and Smt. Indira Devi with the State Bank of India, Poona, in which the amounts received between the years 1954-55 to 1959-60 were deposited. The total deposits during all these years aggregated to Rs. 1,54,988. A major part of these deposits amounting to Rs. 96,442 was given by two American gentlemen by name Richard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hether assessments could be made on the basis that the amounts belonged to him ; assuming that the amounts belonged to the assessee, whether they constituted income in his hands ; whether in any event the said amounts were exempt from tax under section 4(3)(vii) of the Act and whether the Tribunal erred in law or acted without any evidence and contrary to the materials on record, in holding that the assessee carried on a profession or vocation. On behalf of the assessee three contentions are urged before us by Mr. Palkhivala. Firstly, he contended that the activities carried on by the assessee did not constitute a vocation within the meaning, of section 10 of the Act. Secondly, he contended that the amounts from time to time paid to him by the particular individuals were not receipts arising out of a profession or vocation, but the same were given as personal gifts to the assessee out of personal esteem and veneration for him and that the same were not income and were not liable to tax and, lastly, he contended that in any event the amounts were not received by the assessee as his personal income, but they were impressed with the character of a trust. In view of the decision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... failed to lead all the evidence in support of his contention that it is not within the taxing provision. See Parimisetti Seetharamamma v. Commissioner of Income-tax. It is further laid down in this case that a conclusion recorded by the Tribunal by wrongly throwing the burden of proof upon the assessee cannot be regarded as binding upon the High Court in a reference under section 66 of the Act. Whenever an amount is paid as a personal gift for the personal qualities of the assessee and as a token of personal esteem and veneration it cannot be subjected to tax as income arising out of business, profession or vocation under section 10 of the Act. Such a principle is quite apparent from the decision of the Supreme Court in Mahesh Anantrai Pattani v. Commissioner of Income-tax. The head-note correctly sets out the facts and lays down the ratio of the decision as under: " The assessee acted as the Chief Dewan of the native State of Bhavnagar since December, 1937, and continued to hold that office until January, 1948, when responsible Government was introduced by the Maharaja. On January 22, 1948, the Maharaja passed an order granting the assessee a monthly pension of Rs. 2,000, whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... steem. The amount was, therefore, in the opinion of the Supreme Court not taxable. It will be useful to refer to some of the observations of Viscount Cave in Reed v. Seymour. At page 646 Viscount Cave points out that: "....it must now (I think) be taken as settled that they (salaries, fees, wages, perquisites, or profits whatsoever from an office or employment of profit) include all payments made to the holder of an office or employment as such-that is to say, by way of remuneration for his services, even though such payments may be voluntary--but that they do not include a mere gift or present (such as a testimonial) which is made to him on personal grounds and not by way of payment for his services. The question to be answered is, as . . . 'Is it in the end a personal gift or is it remuneration?' If the latter, it is subject to the tax ; if the former, it is not." The Calcutta High Court in David Mitchell v. Commissioner of Income-tax, lays down the test as under: " The test for determining whether casual and non-recurring receipts of this kind are mere gifts or windfalls which are not income or income from the profession or vocation of the assessee, is first, whether th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were benefited by them talents directly or by persons who appreciated his activities from afar, would be receipts arising from the exercise of a vocation. In his entire order the evidence which was produced in the form of affidavits was totally ignored. The true principles which will permit a court in a reference to interfere with the findings of fact of the Tribunal are now well-settled in view of the decision of the Supreme Court in Mehta Parikh Co. v. Commissioner of Income-tax. In that case the cash book of the assessee was accepted and the entries therein were not challenged. Neither further accounts nor vouchers were called for. The persons who gave the affidavits were not cross-examined. When such facts exist, the Supreme Court points out that it is not open to the revenue to challenge the correctness of the cash book entries or the statements made in the affidavits. It is further held in this case that the facts proved or admitted may provide evidence to support further conclusions to be deduced from them which conclusion may themselves be conclusions of fact and such inference from facts proved or admitted could be matters of law. The court would be entitled to interven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee. According to him the assessee was not, giving any instruction to anyone and he was only singing at different places. Another American gentleman by name Don Taxsy who was living with Richard Miller also contributed several amounts from time to time. In his affidavit declared on September 25, 1959, he has stated that at no time prior to July 26, 1959, he met the assessee at any time. He saw him for the first time when he arrived at Poona on that day. He further states in his affidavit that he was impressed on reading the assessee's books, that the assessee had no money with him to build a temple for his Lord and he thought of sending his mite towards building temple house for the assessee. He joined his friend Richard Miller in sending along with him his weekly savings from out of his weekly earnings to Indira Devi, Poona. The veracity of these statements in these affidavits was not even questioned by the Income-tax Officer at any time. While the matter was in appeal before the Appellate Assistant Commissioner a letter dated September 28, 1962, written by Don Taxsy was filed. In this letter he has also stated that he was charmed by the voice and books of the assessee. At no time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onal esteem and veneration and expressly for the purpose of building a temple at Poona. Ordinarily, the burden lies upon the revenue to show that any amount which it seeks to tax in the hands of an assessee is income. In fact, no evidence whatsoever has been produced on behalf of the revenue to show that these receipts are income and in the face of these affidavits, it is affirmatively established that the amounts which were paid by these persons were mere personal gifts out of personal regard, esteem and veneration for the assessee. Such gifts cannot be taxed as income arising out of business, profession or vocation within the meaning of section 10 of the Act. Strong reliance was placed by Mr. Hajarnavis upon the decision of the Supreme Court in Krishna Menon's case above referred to. That decision, in our opinion, has no application to the facts of the present case, because the Supreme Court in that case took the view that in taking up teaching Vedanta philosophy the assessee was carrying on a vocation and that the payments made by the disciples were received by the recipient from his vocation. In that case the Supreme Court has also taken the view that if the voluntary payment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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