Decided on May 30,1994



B.M. KOTHARI, A.M. : - (1.) THE only ground in this appeal by the Revenue is that the CIT(A) has erred in holding that lottery prize of Rs. 15 lacs was won by the assessee alongwith other 7 co-winners.
(2.) The assessee filed a return of income on 16th May, 1986 showing income of Rs. 82,310. As per the said return the assessee derived income from salary and also lottery winning prize. As per the statement annexed with the said return it was mentioned that the assessee derived 1/8th of the total lottery winning prize of Rs. 15 lacs. He included his 1/8th share of Rs. 1,87,500 in the said return of income. The prize was announced in Dec., 1985. Soon thereafter, the assessee wrote to the Assessing Officer informing him that the prize has been won jointly by 8 persons and his share is only 1/8th. It was further pointed out that the authorities under the Gujarat State Lottery rules would disburse the entire prize money in one name and will deduct tax at source at the rate of 30% unless a certificate for lower deduction of tax at source is obtained from the Assessing Officer and is submitted to the lottery authorities. The assessee, therefore, submitted an application to the Assessing Officer for issuing a certificate for deduction of tax at lower rates. The assessee worked out his tax liability on 1/8th share of the prize money at Rs. 31,125 which attracted tax rate of only 2.075% of total prize money. He accordingly, requested the ITO for a certificate authorising tax deduction at 2.075%. The Assessing Officer took the view that tax liability of all the 8 co-winners will have to be safeguarded. He accordingly required the assessee to submit a revised application in which tax liability of all the 8 co-winners should be calculated. The revised working was submitted and thereafter the Assessing Officer issued a certificate for deduction of tax at the rate of 16%, which would cover the individual tax liabilities of all the 8 co-winners. All the co-winners opened a joint bank account with Bank of India which was to be operated by any one of them or the last survivor as per certificate of the bank dt. 24th June, 1988. The lottery prize was collected through the said joint bank account of all the 8 co-winners. However, the prize money was given by the lottery authorities by a cheque in the name of the appellant. The TDS certificate issued by the lottery authorities was also in the name of the assessee.
(3.) THE Assessing Officer observed that as per letter dt. 20th April, 1987, of the Accounts Officer, Gujarat State, Gandhinagar, it has been confirmed that Shri Abdul Majid Valimohmad Dal (the appellant) has won the prize of Rs. 15 lacs. He also reproduced certain extracts from the statements of the assessee in the assessment order. THE Assessing Officer thereafter came to the conclusion that the entire amount of prize money of Rs. 15 lacs is taxable in the hands of the assessee. After allowing deductions under S. 80C and 80TT, he determined the total income at Rs. 7,39,450.;

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