TMI Blog1989 (1) TMI 98X X X X Extracts X X X X X X X X Extracts X X X X ..... funds received for distribution as mass stipend, is income in the hands of the assessee ? The questions referred by the Income-tax Appellate Tribunal for the years 1974-75 and 1975-76 are as follows : "1. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in holding that the sum of Rs. 69,519 being the surplus remaining with the assessee out of the mass stipends of Rs. 2,13,617 received by the assessee during the previous year for the assessment year 1974-75 was the income of the assessee for this assessment year, namely, 1974-75 ? 2. Whether, on the facts and circumstances of the case, the Incometax Appellate Tribunal was right in holding that the sum of Rs. 55,162 being the balanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are mass stipends. Before the Appellate Tribunal, the assessee pleaded that the surplus that remained at the end of the accounting year does not belong to the assessee, that he held the same under a legal obligation to carry out the instructions of the remitter for the purpose of having the mass said, that the surplus cannot be treated as his income, and that the receipts are only in the nature of charity collections. The Appellate Tribunal, negatived the above pleas. It was held that the receipts were admittedly mass stipends, that the assessee received the amounts to say the masses, or to have the masses said by others, that the assessee was not required under the arrangement to pay the amount to others, that there was no question of any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tions received by a trust created wholly or partly for charitable or religious purposes or by an institution established wholly or partly for such purposes, not being contributions made with specific direction that they shall form part of the corpus of the trust or institution ; Explanation. -For the purposes of this sub-clause, 'trust' includes any other legal obligation ; (iii) the value of any perquisite or profit in lieu of salary taxable under clauses (2) and (3) of section 17 ; (iv) the value of any benefit or perquisite, whether convertible into money or not, obtained from a company either by a director or by person who has a substantial interest in the company, or by a relative of the director or such person, and any sum paid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ness or the exercise of a profession or occupation ; or (iii) receipts by way of addition to the remuneration of an employee ; " It will be evident from the above that the definition of the word "income" is an inclusive one. It is also evident from the proviso to section 10(3) of the Act that even if the receipts are of a casual and non-recurring nature, if the receipts arise from business or the exercise of profession or occupation, the said receipts will be included in "income". In Rev. Father Prior, Sacred Heart's Monastery v. ITO [1956] 30 ITR 451 at page 478, paragraph 34, a Division Bench of the Travancore Cochin High Court explained what is mass stipend. The Court held : "It is true that mass stipend is a donation. But it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee by virtue of his profession, vocation or occupation will Constitute income. Section 10(3)(ii) of the Act takes within its fold any receipts arising from the exercise of a profession or occupation in the total income. The receipts may be casual or of a non-recurring nature. The word "occupation " generally means the trade or calling by which -a person seeks to get his livelihood. The word "vocation" also means the same thing. In the Law and Practice of Income Tax by Kanga and Palkhivala, Seventh edn., page 240, it is stated : "Gratuitous grants or voluntary subscriptions paid by the congregation to ministers of religion employed by the Church are assessable as income arising from the exercise of occupation." Similarly, in Sampa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge Thomas' case [1985] 156 ITR 412 (SC), at pages 420 and 421, the court observed as follows : "It has been established that the assessee was carrying on a vocation, the vocation of preaching of Christian Gospel and helping anti-atheism was the vocation of his life. He was running a newspaper in aid of that. The donations received from America were to help him for the said purpose. They arose out of his carrying on and continued so long as he carried on this avocation or vocation. These receipts, therefore, arose out of his vocation. These were, therefore, his income... In the instant case, there cannot be any doubt that the receipts by the assessee arose out of the avocation of the assessee of propagating views against atheism and prea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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