The Medals, Rewards & the Tax

By Vijay Kumar

WHILE returning from the Rio Olympics, P. V. Sindhu and Sakshi Malik brought home 2 medals - a silver in badminton and bronze in free-style wrestling respectively.

Everyone is happy and one-upmanship between the States, politicians, PSUs & private individuals/companies is clearly evident.

These are the cash rewards (as being widely reported) that the medal winners would be purportedly getting for their meritorious efforts -

PV Sindhu - Rs 25.61 crore*

• Rs 5 crore from the Telangana government

• Rs 3 crore from the Andhra Pradesh government

• Rs 2 crore from the Delhi government

• Rs 2 crore: broken into Rs 50 lakhs each from the Haryana and MP governments, the sports ministry and the Badminton Association of India

• Rs 75 lakh from Bharat Petroleum

• Rs 50 lakh from Dubai-based Indian businessman Mukkattu Sebastian

• Rs 30 lakh from the Indian Olympic Association

• Rs 5 lakh from the AIFF (All India Football Federation)

• Rs 1.01 lakh from Salman Khan.

• Two house plots valued at 5 crore each from the AP and Telangana Governments.

• Two acre land from a film star valued at 2 crore

Sakshi Malik - Rs 5.16 crore*

• Rs 2.5 crore from the Haryana government

• Rs 1 crore from the Delhi government

• Rs 60 lakh from the railway ministry

• Rs 50 lakh from Dubai-based Indian businessman Mukkattu Sebastian

• Rs 30 lakh from the Union sports ministry

• Rs 20 lakh from the Indian Olympic Association

• Rs 5 lakhs from the AIFF

• Rs 1.01 lakh from Salman Khan

* updated as on 21st August 2016

Whether these amounts would attract Income Tax?

It was not easy going for Abhinav Bindra, the first person in the history of independent India to have won the Olympic Gold Medal in the 10m Air Rifle event. He had to take the battle to the ITAT to shoot down the demand. See 2013-TIOL-656-ITAT-DEL in DDT 2158

Thankfully, the CBDT realized the furore its actions could cause and so came out with a tax exemption. See DDT 2282 for an answer.

But what about the medal won - does it attract Customs duty?

To know its fate, please see DDT 1062.