Kapil Dev Nikhanj Vs ACIT (ITAT Delhi)
The Income Tax Appellate Tribunal (ITAT) Delhi ruled in favor of Kapil Dev, granting him a tax exemption of ₹1.5 crore received as a one-time benefit from the Board of Control for Cricket in India (BCCI). The appeal stemmed from an earlier assessment order for the assessment year 2015-16, where Kapil Dev had voluntarily declared this amount as taxable income. However, he later challenged this classification after being advised that such a benefit was exempt under Section 56(2)(vii) of the Income Tax Act. The Commissioner of Income Tax (Appeals) [CIT(A)] had initially dismissed his appeal due to a significant delay of 1993 days in filing. However, ITAT acknowledged the delay as justified, citing recent tribunal rulings that clarified the exemption’s applicability.
The tribunal rejected the revenue department’s argument that the exemption claim should have been made in the original return. It emphasized that appellate authorities have the power to entertain valid claims even if they were not initially claimed. The ruling referenced a similar case involving cricketer Maninder Singh, where the tribunal held that benefits from a registered trust or institution like BCCI qualify for exemption. The ITAT ultimately ruled that the amount should not be taxed, aligning with the constitutional principle that no tax should be collected unless authorized by law. This decision reinforces the legal stance on exemptions for one-time benefits from recognized sports bodies.
