stipend taxable or not

TRAINEE’S STIPEND 
WHETHER TAXABLE? 
IN ANOTHER case of ‘A Ratnakar Rao vs Addl CIT’ 128 ITR 527, Karnataka High Court had occasion to consider whether the trainee’s stipend granted to a physician to further his education and training was exempt under Section 10(16). The Income-tax Department took the view that the amount received by the taxpayer was not in the nature of scholarship, but it was salary for the services rendered. 

    The High Court held that the amount paid to the taxpayer was for the benefit of securing training and pursuing study and research in medicine and the entire amount received from the hospital was in the nature of scholarship and not for services rendered and services, if any, rendered by the taxpayer were only incidental to the course of practical training. 

    Similarly, the Income-tax Appellate Tribunal, Jaipur Bench has in the case of ‘Sudhirkumar Sharma vs ITO’ 17 TTJ 226, held that the stipend received by an Article Clerk from a Chartered Accountant is exempt, since it is not paid for rendering services by the Article Clerk, but is paid to him to meet the cost of books, coaching fee, examination fee, etc

ACHULLY SCHOLARSHIPS ONLY TAX FREE 

But  CA article's stipend, IS TAXABLE