winning from unsold lottery ticket is treated as a business income under the head PGBP of the lottery seller and taxed as per normal slab rate applicable to individual

It wld be taxable under the head Other sources because the source/nature of income is lottery winning....like in case of business of letting of house property income is taxed under "HP" and not "PGBP".

Hmmm!

Lets think it other way!

As on 31st march, Where do we show "unsold Lottery tickets Stock" "in the B/Sheet" ofcourse!

Now take for instance of a Jwellery Shop, he showed Gold as Stock & suddenly in one month the price of Gold doubles - Will the sale be treated as STCG or PGBP

In another instance "a trader of shares" Got Bonus of 100 shares per one share, Will sale of bonus be treated as STCG or PGBP

Now here the Lottery ticket seller has Income from PGBP, winning of lottery cannot be treated as casual here, because suppose the trader has 30 Shops at different locations (Generally many own small stalls) & in normal course of business of selling lottery tickes, many tickets remain unsold. Forget Big prize money, every lottery trader wins lottery on daily basis though in small proportions like say lottery winnings ranging from Rs. 100 to 10,000/-. Then from 30 shops, i estimate that the trader might be winning lottery money of atleast Rs. 3,000/- per day (Rs. 100/- x 30) i.e Rs. 90,000 per month and Rs. 10,80,000/- per annum. How can it be treated as casual income, it is a permanent source of Income from business and arising from normal course of Business.

So it has to be treated as PGBP.

 YOUR INCOME IS NOT BUSINESS INCOME BECOZ LOTTERY INCOME IS ALWAYS INCOME FROM OTHER SOURCES AND INCOME CHARGEABLE RATE 30%

Taxed under business income only and tax shall be levied at the normal slab rate not at the flat rate of 30%.

it will be taxed at the flat rate of 30%, because CBDT wants to discourage this type of incomes n all winning from lotteries whether it is from ticket purchased or from tickets remains unsold. how can u people say that on the one hand it will be taxed at 30% if tickets are purchased n on the other hand it will be taxed at normal slab rate if it is from unsold ticket after all it is winning from lotteries n will be taxed at flat rate of 30%....... there is specially written in the IT act that all winning from lotteries will be taxed at the Rate of 30% ( whether casual or from business)

i totally agree with Raj nd his logic..its a business income.......

winning prize won from unsold lottery tickets will always be  taxable as a business income and hence it will be taxable as a business income and taxable at slab rate not as maximum marginal rata

DEAR FRIENDS,

It's really a good discussion on the subject matter.

I repeat my earlier reply that the income from winning from lotteries that was in stock and remained unsold should be taxable as the business income only and not as the income from other sources. To substantiate, I attached herewith the decision in the landmark judgement held by the Gauhati High Court in 1994 i.e. Director of State Lotteries Vs. Asst. Commissioner of Income Tax (1994). 

The case cited in our decision is absolutely and clearely matched with the case noted above. In the said judgment it was held that the income should be considered as business income only and not as income from other sources.

I Hope this solves our query

Regards,

Manoj

Dear Manoj Thanx for mention the case law

As per one case law and if a lottery ticket has unsold tickets with him and if he wins the amount it wil be taxable as business income. . i read  in singania book. . let me send the case later. .
 

thanks for the references.....