Mahaveer Kumar Jain vs Commissioner of Income Tax, Jaipur

Bench: 2 — R.K. Agrawal

In Brief

A resident of Rajasthan won Rs. 20 lakhs in a Sikkim State Lottery in 1986 and paid income tax on it under Sikkim's then-applicable tax rules. The Income Tax Department later sought to tax the same income under the Income Tax Act, 1961. The Supreme Court held that since the IT Act did not apply to Sikkim until 1.4.1989, and Article 371F of the Constitution ensured Sikkim's prior tax laws continued until amended, the income was taxable only under Sikkim rules. The Court rejected double taxation without express legislative authorization. The appeal was allowed.

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Income Tax Constitutional Law Double Taxation Sikkim Lottery Winnings Tax Jurisdiction Legislative Authority

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