taxability of stipend
This query is : Resolved
02 June 2010
though I agree with your contention that stipend is differen from salary but still I think there is no employer employee relationship between pricipal and trainee
02 June 2010
Have u read the form 102?
It reads as
Articles of apprenticeship made on the …………………………………….. day of ……………………………… Two
thousand ………………………………………………………between …………………………………………………
…………………………………………………………..of …………………………………………………………………..
……………………………………………………………………………………………………………………(hereinafter)
called the Employer) of the first part, *[…………………………………………………………………… the Chartered
Accountant in practice / partner of Messers ………………………………………………………………….Chartered
Accountants in practice, employing the Employer of the first part (hereafter called the second employer) of the
Second part] and ………………………………………………………………………………………………………….
………………………………………………………………………(hereinafter called the Articled Clerk) of the Second *third part
So how come no employer - employee relationship?
It reads as
Articles of apprenticeship made on the …………………………………….. day of ……………………………… Two
thousand ………………………………………………………between …………………………………………………
…………………………………………………………..of …………………………………………………………………..
……………………………………………………………………………………………………………………(hereinafter)
called the Employer) of the first part, *[…………………………………………………………………… the Chartered
Accountant in practice / partner of Messers ………………………………………………………………….Chartered
Accountants in practice, employing the Employer of the first part (hereafter called the second employer) of the
Second part] and ………………………………………………………………………………………………………….
………………………………………………………………………(hereinafter called the Articled Clerk) of the Second *third part
So how come no employer - employee relationship?
02 June 2010
Even if the same is not taxable as salary income it is taxable as income from other sources.
02 June 2010
Stipend received by an articled assistant is tax free.
Citation- Sudhirkumar Sharma Vs.ITO(1983)17 TTJ(Jp-Tri)228.
Citation- Sudhirkumar Sharma Vs.ITO(1983)17 TTJ(Jp-Tri)228.
02 June 2010
Dear Sir
The case law referred is of Sudhir Kumar Sharma (1983) 15 Taxmann 100 of ITAT Jaipur Bench.
Orders of the ITAT have no validity in the income tax laws and on the department. Further in the same case law there is mention that the same is applicable before introduction of rule 32B prescribing the minimum stipend rules was prescribed by the Institute which do not follow the follow the practice of paying a meager amount to meet the cost of books, fees, etc and hence cannot be termed as receipt for the purpose of meeting the cost of education to be exempt u/s 10(16).
The case law referred is of Sudhir Kumar Sharma (1983) 15 Taxmann 100 of ITAT Jaipur Bench.
Orders of the ITAT have no validity in the income tax laws and on the department. Further in the same case law there is mention that the same is applicable before introduction of rule 32B prescribing the minimum stipend rules was prescribed by the Institute which do not follow the follow the practice of paying a meager amount to meet the cost of books, fees, etc and hence cannot be termed as receipt for the purpose of meeting the cost of education to be exempt u/s 10(16).
02 June 2010
Agree to Aditya.
It is Definately taxable......
But wil lbe taxed in the IOS...
@ Aditya: Thanks for the form.. even i was not knowing it.. but i saw that Article is not treated as employee in the same form. SO i think it wil be under IOS only.
It is Definately taxable......
But wil lbe taxed in the IOS...
@ Aditya: Thanks for the form.. even i was not knowing it.. but i saw that Article is not treated as employee in the same form. SO i think it wil be under IOS only.
02 June 2010
Yes it will be taxable under the head income from other sources only.
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