Fashion designers Ritu Beri and Sabyasachi, Fashion TV, musicians Louis Banks, Gary Lawyer and cricket commentator Harsha Bhogle — all formed part of nearly an hour-long discussion conducted in the Bombay high court just to determine whether or not designer Tarun Tahiliani is an ‘artist’.
Tahiliani, whose creations are donned by the who’s who of the country, had sought a deduction of his income earned through foreign assignments under section 80RR that was introduced in the Finance Act, 1969, in 1970. He was entitled to the deduction of a specific amount in computing the total amount of taxable income.
However, the Income Tax (I-T) department insists that Tahiliani is not an artist as defined under section 80RR and is contesting an order of Income Tax Appellate Tribunal (ITAT) granting an artist’s privilege to Tahiliani.
Section 80RR refers to Indian authors, playwrights, artists, musicians, sportsmen and actors who receive income from foreign parties for their work. In such cases, under section 80RR, 75% of the total income obtained from the foreign government is exempted from tax.
Seeking the definitions of the word ‘artist’ from the Oxford and the Webster’s dictionaries, the division bench of justice DY Chandrachud and justice JP Devadhar have asked the I-T department to do its homework on “what is an artist?” and come back with “weightier” arguments on June 12.
Justice Chandrachud said, “Had the word (in section 80RR) been ‘artiste’ it would have been a broader term but ‘artist’ would be restricted to a painter.”
Tahiliani’s counsel, however, argued that a dress designer is notified to be a film artist just like photographers and cameramen, as stated in clause C of the section. Therefore, artist cannot be restricted to a painter.
I-T department’s advocate Anamika Malhotra told the court that the provision in law was made to aid artists who represent Indian culture abroad and dress designers did not always do that. The court, however, said that the exemption cannot depend on the design but on the nature of the profession. “That is the weakest link in your stand,” justice Chandrachud said.
Although musicians and actors are categorically stated in the Act, the court sought an elaboration on why lawyers or doctors, where scientific knowledge is greater than creativity, are not artists. The judges said that the issue is interesting for them to apply their minds to.