DILIP KUMAR ROY Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS is a reference to this court under section 66(1) of the Indian Income -tax Act, 1922 (hereinafter referred to as 'the Act'), 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 the 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 word and sometimes gave lectures on his tour. He attracted several persons towards him, who called him their guru.

(2.) 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 Miller and Don Taxsy. These amounts were utilised for construction of the property known as 'India Milay Harikrishna Mandir' at Poona.

(3.) THE Income -tax Officer took the view that even assuming that the amounts received were voluntary payments from the various persons, from the standpoint of the assessee they were taxable receipts being received by virtue of his procession whether as a philosopher, writer, musician, or a spiritualist and they are his receipts from procession. On an appeal by the assessee before the Appellate Assistant Commissioner, the finding of the Income -tax Officer was reversed. He took the view that the receipts were not receipts arising from business or exercise of profession or vocation. In his opinion, they were testimonials and personal gifts given to the assessee as a token of esteem and regard for his personal qualities. In view of this finding according to the Appellate Assistant Commission, these amounts for the years 1954 -55 to 1959 -60 were not subject to tax in the assessment of the assessee for the relevant years. On an appeal by the revenue before the Tribunal the original order passed by the Income -tax Officer was restored. The Tribunal took the view that the amounts deposited in the bank account were liable to tax in the hands of the assessee. It found that all the disciples of the assessee intended to give moneys primarily to him and since the amounts were given to him in the first instance the income from the property constructed out of those amounts could be rightly taxed filled in the hands of the assessee.