Re : Stipend taxable or exempt

Page no : 2

Sunali (Learner) (1317 Points)
Replied 05 December 2009

Originally posted by :Sushil
"	Sec 10(16) of IT Act, 1961 says, "Any scholarship granted to meet the cost of education.Section 10(16)" When a person gets scholarship there is no relationship of employer - employee like ICAI gives scholarship to rankholders of PCC, Backward class student on fulfillment of given criteria. Literal interpretaion says that Stipend is not a scholarship and when a person gets stipend there exists employer - employee relationship...if it exceeds minimum exemption limit then its Taxable under the head Salary.	"

It is taxable under the head "salaries"...check your deed of articles friends...where it is written that party of first part i.e. the principal is an 'Employer',,hence employer employee relationship do exist..

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Akash Pincha (CHARTERED ACCOUNTANT) (188 Points)
Replied 05 December 2009

Mr. Deepak there exist an employer and employee relationship, as on joining of articleship we have to sign form 102 and where it is clearly written about the employer and employee relationship between the principal and article assistant. So there is no question about employer and employee's relationship existence as it is amply clear from Form 102.

CA Jitender Kushwah (Chartered Accountant) (32 Points)
Replied 05 December 2009

Stipend is taxable under the income tax act, as it is a form of salary paid to student.

(Guest)

exempt

CA Jitender Kushwah (Chartered Accountant) (32 Points)
Replied 05 December 2009

It is taxable, as it is a form of Salary.

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CA Trinath Galla (student) (3130 Points)
Replied 05 December 2009

stipend is not taxable under income tax act

CA Trinath Galla (student) (3130 Points)
Replied 05 December 2009

Originally posted by :Akashdeep Singh
"	Stipend is not taxable. Read the attached case law	"

CA Balram Sharma (CA) (839 Points)
Replied 05 December 2009

Stifund is taxable under the head salary,

there is not any exemption under income tax act,

Akash Pincha (CHARTERED ACCOUNTANT) (188 Points)
Replied 05 December 2009

Hey guys, this topic has really distributed the views in two parts, so if anyone has an opinion about this topic i.e. is stipend taxable or not??? put your views here (with reasons including decision held on cases if any), so that it can be amply clear.

Aditya Maheshwari (CA in Practice) (35867 Points)
Replied 05 December 2009

I have many friends who were working with the big 4s and there tax was being deducted on the stipend received by them during their articleship as per provisions of Section 192 and at the end of the year TDS deducted certificate in Form no. 16.

So if they are following this procedure then the same must be taxable.

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Suman (student) (44 Points)
Replied 05 December 2009

BISWA RANJAN JATI (Dy. Vice President- Accounts Finance Taxes & Legal) (59 Points)
Replied 05 December 2009

Dear all stipend does not taxable as there is no employer & employee relationship exists in one s. However in other way the term " salary '" signifies a recompense or consideration given to any person for pain bestowed upon another persons business.So you can take this in tax consideration or not that depends upon you.

Punit Tibrewal (student ) (1684 Points)
Replied 05 December 2009

between a principal & his article assistant employer & employee relationship do exist because the principal has the power to control & direct the assistant...!

so the maxim that ther is no employer-employee relationship doesnot hold good....!