Pratibha A Kothavale, Mumbai vs Assessee

Mrs. Pratibha A. Kothavale 3rd Floor, Phoenix ................. अपीलार्थी / 457, S.V. Road Girgaum Mumbai 400 004 Appellant PAN - AAHPK3771D

v/s

Dy. Commissioner of Income Tax ................... प्रत्यर्थी / Circle-16(3), Matrimandir Mumbai 400 007 Respondent

Assessee by : Shri Sanjeev V. Joshi Revenue by : Shri Premanand J.

Date of Hearing - 07.05.2015 Date of Order - 07.05.2015

ORDER

PER I.P. BANSAL, J.M.

This appeal is filed by the assessee and is directed against the

order dated 28th February 2012, passed by the Commissioner

(Appeals)-27, Mumbai, for the assessment year 2008-09. Following

grounds have been raised by the assessee:-

1. The ld. CIT(A) erred in holding that the appellant is not entitled to deduction of ` 2,70,000/- u/s 80QQB.

2. The ld. CIT(A) erred in holding that the royalty income is not derived by the appellant in the exercise of profession and is therefore not entitled to deduction u/s 80QQB.

Mrs. Pratibha A. Kothavale

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3. The ld. CIT(A) erred in holding that the appellant has not parted with / assigned nor granted any rights in the copy right of any book.

4. The ld. CIT(A) erred in holding that the transaction of appellant receiving royalty of ` 2,70,000 without deduction of tax at source from a family concern (M/s. Majestic Prakashan) is a questionable transaction with a view to avoid payment of tax.

2. The assessee has authored a book "Perfect Recipes" and since

assessment year 2002-03 the assessee is receiving royalty, which for

the year under consideration is a sum of ` 2,70,000. On the said sum,

the assessee has claimed deduction under section 80QQB which was

denied by the Assessing Officer on the ground that the assessee could

not submit any evidence to show that it was an "art" and it can be

taken as unlike painting sculpture, etc. According to the Assessing

Officer, coking is not an "art" and is a "skill" and, therefore, the

assessee is not eligible for deduction under section 80QQB. The

disallowance has been sustained by the learned CIT(A) for the reasons

that firstly, according to the requirement of section 80QQB, such

income should have been earned in the exercise of the profession and

secondly; the cookery does not come in the definition of "art". The

assessee is aggrieved and has filed the aforementioned grounds.

3. After narrating the facts, it was submitted by the learned Counsel

for the assessee that the assessee is receiving royalty since

assessment year 2002-03 and the details of the receipts of the Mrs. Pratibha A. Kothavale

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assessee as royalty from the publication of aforementioned book is

listed at Page-3 of the paper book. It was submitted that the word "art"

has been defined which includes 64 items and at serial no.21, the word

"art" is stated as under:-

"21. Culinary art, i.e., cooking and cookery"

4. Reference in this regard was made to the definition downloaded

from the website a copy of which is filed in the paper book Page-4 and

5. Thus, it was pleaded by the learned Counsel that the learned CIT(A)

has committed an error in not allowing the relief to the assessee.

5. On the other hand, it was submitted by the learned Departmental

Representative that cookery does not fall within the definition of "art".

He submitted that it has been found by the learned CIT(A) that the

assessee is having business income from the proprietorship concern

M/s. Majestic Book Depot and M/s. Deepawali Annual and no

professional income from cookery has been shown by the assessee at

any point of time. Thus, he pleaded that the learned CIT(A) has rightly

held that deduction under section 80QQB, cannot be allowed to the

assessee.

6. Per-contra, it was submitted by the learned Counsel that as per

the definition of "Business" given in section 2(13), it include adventure

in nature of trade and in view of one time venture of the assessee of Mrs. Pratibha A. Kothavale

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authoring the book the same should be considered as professional

activity.

7. We have heard both the parties and their contentions have been

considered carefully. The word "profession" is defined in section 2(36)

which is as under:-

"Profession includes vocation"

8. The word "profession" was subject matter of interpretation before

the Hon'ble Rajasthan High Court in CIT v/s Bhagwan Broker Agency,

[1995] 212 ITR 133 (Raj.). Their Lordships have considered various

decisions as well as definition given in the dictionary and after

considering all these decisions and definitions, their Lordships have

arrived at a conclusion that there should be some special qualification

of a person apart from skill and ability which is required in carrying on

any activity which could be considered as "profession". This could be

having education in a particular system either in the college or

university or it may be by experience. In the present case, when the

learned Counsel for the assessee was required to explain that whether

any other book is written by the assessee before or after the book

written by the assessee prior to the assessment year 2002-03, in reply,

it was submitted by the learned Counsel that the assessee did not write

any other book. We found that no particulars have been placed on Mrs. Pratibha A. Kothavale

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record to show that the assessee is specially qualified apart from the

skill and ability to write the book. There is also no material on record to

say that whether the assessee is having education in the field of

cookery either in the college or university or even by experience. There

is no such material on record to suggest that the assessee is qualifying

for the parameters laid down for considering a particular activity as a

professional activity. In any case, the income earned by the assessee

as royalty cannot be said to be earned by the assessee "in the exercise

of her profession" which is the main requirement of the section

according to which deduction can be allowed under section 80QQB. The

non-fulfillment of such condition would disentitled the assessee to claim

deduction under section 80QQB. Therefore, we do not find any infirmity

in the order passed by the learned Commissioner (Appeals) vide which

it has been held that the assessee is not entitled for deduction under

section 80QQB, we decline to interfere. The grounds raised by the

assessee are dismissed.

9. In the result, assessee's appeal is dimissed.

Order pronounced in the open Court on 07.05.2015

Sd/- Sd/-

RAJENDRA I.P. BANSAL ACCOUNTANT MEMBER JUDICIAL MEMBER

MUMBAI, DATED: 07.05.2015 Mrs. Pratibha A. Kothavale

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Copy of the order forwarded to:

(1) The Assessee; (2) The Revenue; (3) The CIT(A); (4) The CIT, Mumbai City concerned; (5) The DR, ITAT, Mumbai; (6) Guard file. True Copy By Order Pradeep J. Chowdhury Sr. Private Secretary

Assistant Registrar ITAT, Mumbai