In a significant ruling, the Income Tax Appellate Tribunal has recently granted tax exemption to legendary cricketer Kapil Dev on a sum of ₹1.5 crore awarded by the Board of Control for Cricket in India (BCCI) as a one-time benefit for his outstanding contributions to Indian cricket.
Case Background
The BCCI, in 2012, introduced a one-time benefit scheme to reward former cricketers who had served Indian cricket with distinction. Under this scheme, Kapil Dev, India’s 1983 World Cup-winning captain, received a payment of ₹1.5 crore. However, tax authorities initially categorized this amount as taxable income, prompting Kapil Dev to contest the tax liability.
ITAT’s Verdict
The ITAT ruled in favor of Kapil Dev, stating that the amount received was in recognition of his lifetime contribution to the sport and did not constitute professional income. The tribunal emphasized that such awards and grants fall under the category of honorary payments and should not be subject to income tax.
Implications Of Ruling
The decision is expected to have broader implications for other former cricketers and sports personalities who receive similar honorary payments from governing bodies. Legal experts believe that this ruling sets a precedent for tax exemptions on honorariums and awards granted for lifetime achievements.
Kapil Dev’s Response
Reacting to the verdict, Kapil Dev expressed his gratitude to the ITAT, stating, “This amount was given in appreciation of my service to Indian cricket, and I am pleased with the tribunal’s decision. It is a welcome move for all sportspersons who have dedicated their lives to representing the country.
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