Beijing Olympics gold medallist Abhinav Bindra, who has been showered with cash awards totalling more than Rs four crore for his historic triumph will not pay tax
NEW DELHI; Beijing Olympics gold medallist Abhinav Bindra, who has been showered with cash awards totalling more than Rs four crore for his historic triumph, will not have to pay any tax on these rewards as he has been categorised as a non-professional sportsperson by IT authorities.
The ace shooter, the entrepreneur son of an affluent businessman in Punjab, won the gold medal in the 10m Air Rifle competition in Beijing.
He is being categorised as a non-professional or amateur sportsperson, which is "not liable to tax" under existing Income Tax laws, an IT official said.
According to a Central Board of Direct Taxes (CBDT) 1986 circular, such awards in case of a sportsperson, who is not a professional, will not be liable to tax as it would not be in the nature of income.
It, however, adds "whether a sportsman is a professional or not will depend upon the facts and circumstances of each case to be decided by the assessing officer" and in cases where the receipt is in the nature of gift, the chargeability to gift-tax will be considered separately.
The sporting discipline of rifle shooting is amateur in India and hence any sportsperson practicing the sport will be considered an amateur, a spokesperson of the National Rifle Association of India (NRAI) said.
"The circular is still in force and there are no new specific provisions on cash awards or gifts offered to sportspersons. Such a sportsperson would hence be tax free," a senior Finance Ministry official said.
Twenty five-year-old Bindra has been offered cash prizes from various state governments, the BCCI, Ministry of Steel, Ministry of Sports and the SGPC.
While the highest contribution till now has been from steel tycoon Laxmi Niwas Mittal, who announced Rs 1.5 crore from his London-based Mittal Champions Trust, the Netball Federation of India has also pitched in with Rs 2.51 lakh and
the Municipal Corporation of Delhi (MCD) had promised the ace shooter Rs five lakh.
The shooter was also awarded a prize money of Rs 50 lakh on Tuesday by the Government to be given away during the Arjuna Awards ceremony on August 29. This prize money comes under the scheme of special award to medal winners in
international sports events.
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