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stipend

suneet (CA FINAL) (421 Points)

30 March 2009

stipend is tax free but i heard from my friend that the payment of stipend is given after cutting tds

explain this

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4 Replies

(Guest)

No TDS is deuctible from stipend........

PRADEEP D PATANGE (CA-Fresher-Service) (110 Points)
Replied 01 April 2009

Stipend is exempt us 10(16) - Sudhir Kumar Sharma vs. ITO (1983) 15 taxman 100 (Jp-Trib).

The Ruling was the stipend for article is only for meeting his cost of books, examination, coching.

So the stipend is not much higher, anyone can take benefit of above caselaw, but if stipend is higher normaly in metro cities than it is difficult to prove.

Go read the case law for more detail

Pradeep

C.A. M.Com. Suhas A. Nagpure (CA) (1175 Points)
Replied 01 April 2009

Under which head stipend will be taxable?

In case of salary - there should be Employer - Employee Relationship..........

Ankur Jain (Article) (50 Points)
Replied 30 April 2009

Suhas, in the chartered accountants act and in ur training guide, u will nowhere find an article being mentioned as an employee. It is relationship of principal-apprentice.............. Thus IF stipend is taxable then only under head Other sources...