SETHURAMAN J. - Under section 256(1) of the Income-tax Act, 1961, the Income-tax Appellate Tribunal, Madras Bench, has referred the following question for the opinion of this court :
'Whether, on the facts and circumstances of the case, the assessment of the sum of Rs. 13,000 as income of the assessee is valid and right in law ?'
The assessment relates to late Sri Anantharama Dikshidar, who was an exponent of the epics like the Ramayana and the Mahabharata. Performances were being organised all over India and he gave discourses in such performances. considerable amounts were collected at the time of his discourses, and he was being assessed to income-tax on such receipts from the assessment year 1957-58 onwards. During the assessment year 1964-65, Sri Anantharama Diskhidar celebrated his Sashtiabdapoorthi. On that occasio, there were cash presents to the extent of Rs. 19,700. The Income-tax Officer estimated a sum of Rs. 6,700 as presents received by Sri Anantharama Dikshidar from his near relations and he took them to be personal gifts made by such relations as token of their personal esteem for Sri Anantharama Dikshidar. After excluding that amount, he took the balance of Rs. 13,000 as assessable income and brought it to tax. The appeal filed by the assessee before the Appellate Assistant Commissioner was unsuccessful. Thereafter, the legal reprsentative of Sri dikshidar who had by then died appealed to the Tribunal. The contention urged on behalf of the assessee was that the entire payment made on the occasion of the Sashtiabdapoothi was a personal gift for the personal qualities of Dikshidar and as a token of personal esteem unconnected with any services rendered, so that the inclusion of the sum of Rs. 13,000 in the assessment was not justified. The contention urged on behalf of the department was that giving religious discourses was the avocation carried on by the deceased and that the income received had also been assessed as professional income. As regards the disputed sum of Rs. 13,000 received on the occasion of the Sashtiabdapoorthi, the contention of the department was that it was in token of the appreciation of the services rendered by the assessee as an able exponent of the Vedantic Hindu Philosophy, and, therefore, they are not personal gifts for the personal qualities of the deceased and the inclusion of the sum of Rs. 13,000 as the income of the deceased was fully justified. The Tribunal examined these contentions and came to the conclusion that the sum of Rs. 13,000 was rightly taxed. It is this order of the Tribunal which is the subject-matter of dispute in the form of the question extracted already.
The fact that the assessee was being assessed on the receipts at the time of his performances, whenever given, is not in dispute. Therefore, the only question that has to be considered is whether the receipt of Rs. 13,000 on the occasion of the Sashtibdapoorthi can be construed as income assessable in his hands. The Tribunal has itself referred to decision of the Supreme Court Parimisetti Seetharmamma v. Commissioner of Income-tax : 57ITR532(SC) . In that case, the Supreme Court has pointed out at page 536 :
'By sections 3 and 4, the Act imposes a general liability to tax upon all income. But the Act does not provide that whatever is received by a person must be regarded as income liable to tax. In all cases, in which a receipt is sought to be taxed as income, the burden lies upon the department to prove that it is within the taxing provision. Where, however, a receipt is of the nature of income, the burden of proving that it is not taxable because it falls within an exemption provided by the Act lies upon the Assessee.'
In paragraph 7 of its order, the Tribunal observes as follows :
'The Supreme Court in Parimisetti Seetharamamma v. Commissioner of Income-tax : 57ITR532(SC) pointed out that where a receipt is of the nature of income, the burden of proving that it is not taxable lies upon the assessee. The onus is, therefore, on the appellant to establish that the sums amounting to Rs. 13,000 received on the occasion of the Sashtiabdapoorthi of the deceased are gifts out of love and esteem and that they are not, therefore, taxable. The appellant has not discharged this onus.'
The Tribunal has wrongly understood the decision of the Supreme Court. The passage extracted already is clear to show that where a receipt is sought to be taxed as income, the burden lies upon the department to prove that it is within the taxing provision, but only, where the character of the receipt is established as income, the burden of proof that it is not taxable lies on the assessee. In the present case, the Tribunal has assumed that a sum of Rs. 13,000 has the character of income, and has cast the onus on the assessee to show that it is not taxable. This is obviously wrong. The Tribunal has to find out whether the sum of Rs. 13,000 has the characteristic of income. In the present case, for the assumption that the sum of Rs. 13,000 has the characteristic of income, there is absolutely no material.
The Tribunal itself has pointed out that the list of persons who had paid the sum of Rs. 13,000 showed that it was the outcome of contributions made by a cross-section of the public consisting of groups and individuals numbering nearly 400, that the contributions varied from Rs. 5 to Rs. 500, and that people belonging to different strata of society and coming from different castes and communities have made the contributions. According to the Tribunal, the large number of contributors representing the various cross-sections of the society was an unmistakable indication to show that the payments were made in token of appreciation of the religious discourses rendered by the deceased and which he was pursuing as his avocation. The Tribunal has further observed that Sashtiabdapoorthi was made an occasion to remunerate the deceased for the professional services rendered in giving religious discourses. The finding of the Tribunal cannot be sustained. The Tribunal itself has pointed out that the assessee had been remunerated for the discourses as and when discourses were held. There is no material on record for saying that the sum of Rs. 13,000 was actually remuneration paid in connection with the past performances, though the occasion for making the said payment was the Sashtiabdapoorthi. In the absence of any such material, the Tribunals assumption that the said sum was remuneration has absolutely no basis whatever. The question has, therefore, to be answered in the negative and against the revenue. The assessee will have his costs. Counsels fee Rs. 500.