Case Law Details
Case Name : Dr. Rahul Tugnait Vs ITO (ITAT Chandigarh 'SME-B' bench)
Appeal Number : ITA No. 197/CHD/2008
Date of Judgement/Order : 30/06/2008
Related Assessment Year :
Courts :
All ITAT ITAT Chandigarh
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RELEVANT PARAGRAPH
5. Even if this appeal is viewed with angle of section 15 of the Act, which speaks about chargeability of salary. Section 15 of the Act is reproduced- herewith:-
“The following income shall be chargeable to income tax under the head “Salaries”-
a). any salary due from an employer or a former employer to an assessee in the previous year, whether paid or not;
b). any salary paid or allowed to him in the previous year by or on behalf of an employer or a former employer through not due or before it became due to him;
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Stipend taxability:
The duty and work of a doctor is in the nature of that a full time employee. He/she is gaining experience from such work and performing duties like regular doctors. In such cases stipend may be taxed if it is exceed the limits which is not chargeable to tax. Hence the taxability depends on the terms of payment, nature of service and amount received.
Further, section 10(16) of the Income Tax Act provides that “scholarship granted to meet the cost of education” in not income. There are Government circulars wherein stipend paid for meeting the cost of education or any research work is out of net of income but in all these circulars the amount of stipend was/is very nominal.
In this regard Madras High Court in case of Dr V Mahadev vs CIT 1990] 184 ITR 533 (MAD.) held that every payment which is received by a person in the nomenclature of Stipend or Fellowship or even Scholarship may or may not be truly be scholarship in the sense of meeting the cost of education. For example, an employee can be given benefit in the nomenclature of “stipend’ which may actually be a wage or salary. That was the reason and on the basis of fact it was held that the stipend received by Dr Mahadev was not exempt from tax.
In Ratnakar Rao vs. Addl. Commissioner of Income Tax [1981] 128 ITR 527 (Kar), the question before Division Bench of Karnataka High Court was whether stipend received by an Indian Doctor to undergo training in pediatrics in a foreign hospital was correctly brought to tax as income? The Division Bench while answering the reference held that if stipend/fellowship money received is to further the education and training of the recipient, such payment does not represent compensation for service to patients, then such payment is excluded from the income under Section 10(16) of the Act.
In Dr. Rahul Tugnait Vs ITO (ITAT Chandigarh ‘SME-B’ bench) ITA No. 197/CHD/2008 order dated 30/06/2008: Scholarship/ stipend received by a student for pursuing higher studies not considered as salary.
In your case the concerned person in under Post Graduation Programme for three years and will get stipend for 1st year Rs.61,500/-, 2nd Year Rs.62,600/- and for 3rd year 63,800/-. It is not clear that whether it is monthly or yearly basis.
(i) If it is yearly then there is no question to decide that it would be covered by the section 10(16) of the Act and would be out tax.
(ii) If it is monthly then there will be no hesitation to say that it is compensation against services and would be taxable u/s 56 of the Act. As such stipend is an income u/s 2(24) and not like scholarship defined u/s 10(16) and liable to tax under other source of income as if it is not chargeable to income -tax under any of the heads specified in section 14, items A to E.
Regards
Nem Singh
Advocate
i am getting postdoctoral fellowship from UGC (43000 PM) for 3 years to carry out research and development.
is it exempted under section 10(16).
plz reply
if an engineering post graduate student(MS) received stipend from MNC (RS,.30000 p.m). Is it taxable under income tax act. If yes is it taxable under which head whether taxable under salary or income from other sources.
i m studying post graduate course in corporate hospital , and get get salary after income tax deduction where as my friends in other corporate hospital are getting stipend without income tax. Kindly mail me ur answer , should i pay tax on stipend ?
Junior and Senior research fellowships awarded by CSIR is exempt under Sec.10(16) of IT Act. Whether the emoluments paid to Research Associates by the CSIR is also exempt under the above section or not??
I receive a scholarship from University Grant Commission under the UGC NET-JRF scholarship scheme for pursuing my Ph.D. degree. It is paid in two parts (a basic amount and a HRA amount)
Is this money taxable ?
Apart from this I have some income as interest from bank savings account and fixed deposit. If the total of the interest incomes and the scholarship amount crosses the taxable limit, do I need to pay tax for this whole amount?
Can anybody please indicate the article of the IT law that deals with this scholarship issue ?
I am working as resident doctor perusing PG degree in govt Ayurvedic college. whether income tax is applicable on stipend or not.kindly inform me on mail.
I am working as resident doctor persuing PG degree in medicine in govt medical college.whether income tax is applicable on stipend or not.kindly inform me on mail.
I work as a research fellow on a project under University Grants Commission (UGC), New Delhi. I get stipend/fellowship of Rs. 14000/-. My institution deducts Rs. 2500/- per year as profession tax. Is my income/fellowship taxable? Please advice.
The deciding factors are these:
1) Whether he/she is a student pursuing studies in India;
2) whether he/she receives salary or stipend or fellowship etc. If it’s salary it’s taxable,if otherwise, not.
3) Generally Indian IT laws applicable only for income derived within India. For income received outside India and brought to India has to be dealt from case to case basis with ref. to applicable laws based on individual conditions & circumstances/status etc.
I am working as resident doctor persuing PG degree in medicine in govt medical college.whetherincome tax is applicable on stipend or not.kindly inform me on mail
Central Government Health Scheme has deleted my wholly dependent daughter’s [unmarried, unemployed and normally resides with me] name as beneficiary on account of scholarship she receives for studying in France. She has also been denied to get prescribed medicines for full course of treatment; admissible limit six months’ medicines in one go for beneficiaries visiting foreign countries.
I solicit guidance about beneficiary eligibility. Thanks.
i was receiving fellowsip during my M.Tech. studies(up to june 2011, Rs8000/- p.m). then got the job. the salary from job is about 2,00,000/- in this financial year. total will be 2,00,000.00 + 8,000 * 3(3 months, april to june, of this financial year) = 2,24,000/-
what is my taxable income.
The case law quoted above speaks about scholarships received from Indian University/Government. I would like to know if the same is applicable for scholarships received from Foreign University for research studies for which the reasearcher will hve to stay in a foreign country. In short is the excess of scholarship amount left after meeting cost of research if brought in India will be taxable under our Income Tax Act. The researcher is a Resident till date.
Stipend received from medical internship & fellowship grant received by a medical student exempt from tax?
i receive fellowship from CSIR (junior research fellowship) and now i want to file income tax return. Wanted to know if i have to mention the amount i receive on the form or not. if yes can you please tell me where to enter it.
thanks a lot
In your comments,you have categorically mentioned that stipends received from a govt institution will be exempt from taxes,but at the end you have also said that “interns” of a medical school will not enjoy such exemption.Presently I am a post graduate trainee in Medicine in a a government medical college,where I also have to render my services as a junior doctor & I receive a stipend,so will my stipend be included or exempted from tax?We don’t know whether any TDS is deducted as the authorities have never asked for our PAN no.
I have cleared my CA examination and receive monthly stipend from my principal much more than the guidelines issued by the Institute of CA. My principal has deducted TDS under the Head Salary. Would my stipend be taxable??
I m a CA final yr Article, i get stipend of 3880 after deducting Rs 120 as a professional tax from it, is the principal liable to deduct such tax?
If some one is receiving higher stipend than declared by the institue,then the higher stipend will be taxable or not