by Illustration 1 – Dividend, Interest and Family Pension
Mr. A received dividend of ₹80,000, interest on securities of ₹60,000 and family pension of ₹1,20,000 during the tax year. Assume an allowable deduction of ₹30,000 from family pension under the applicable provisions.
| Particulars | Amount (₹) |
|---|---|
| Dividend Income | 80,000 |
| Interest on Securities | 60,000 |
| Family Pension | 1,20,000 |
| Less: Allowable Family Pension Deduction | (30,000) |
| Taxable Family Pension | 90,000 |
| Income from Other Sources | 2,30,000 |
Therefore, taxable Income from Other Sources = ₹2,30,000.
illustration 2 – Lottery Winnings
Ms. B won ₹5,00,000 from a lottery. She spent ₹20,000 on purchasing lottery tickets and ₹10,000 on other related expenses. Under Section 94, expenditure or allowance relating to lottery winnings is not deductible.
| Particulars | Amount (₹) |
|---|---|
| Gross Lottery Winnings | 5,00,000 |
| Less: Cost of Lottery Tickets | Nil |
| Less: Other Related Expenses | Nil |
| Taxable Income from Lottery | 5,00,000 |
Therefore, ₹5,00,000 is taxable under Income from Other Sources. The ₹30,000 expenditure cannot be deducted.
illustration 3 – Interest on Securities
Mr. C received ₹1,50,000 as interest on securities held as investments. Assume he incurred ₹10,000 of expenditure that qualifies for deduction under the applicable provisions.
| Particulars | Amount (₹) |
|---|---|
| Gross Interest on Securities | 1,50,000 |
| Less: Eligible Deduction | (10,000) |
| Taxable Interest Income | 1,40,000 |
Thus, ₹1,40,000 will be included in Income from Other Sources, assuming the ₹10,000 expenditure satisfies all statutory conditions for deduction.
illustration 4 – Taxable Gift
Mr. D receives ₹90,000 in cash from a non-relative without consideration. Assume the receipt satisfies the statutory conditions for taxation and no exemption for a specified occasion or circumstance applies.
| Particulars | Amount (₹) |
|---|---|
| Money received without consideration | 90,000 |
| Less: Exempt amount | Nil |
| Taxable Gift | 90,000 |
Since the applicable conditions for taxation are satisfied, the taxable amount of ₹90,000 is included under Income from Other Sources.
illustration 5 – Letting of Machinery
Mr. E lets out machinery and receives ₹2,40,000 during the year. He incurs ₹20,000 on repairs, ₹10,000 on insurance and ₹30,000 as other expenditure. Assume all these expenses are specifically allowable under the applicable provisions.
| Particulars | Amount (₹) |
|---|---|
| Income from letting of machinery | 2,40,000 |
| Less: Repairs | (20,000) |
| Less: Insurance | (10,000) |
| Less: Other allowable expenditure | (30,000) |
| Taxable Income | 1,80,000 |
Therefore, taxable Income from Other Sources = ₹1,80,000.
illustration 6 – Comprehensive Computation
Mr. F has the following receipts during the tax year:
| Particulars | Amount (₹) |
|---|---|
| Dividend | 1,00,000 |
| Interest on Securities | 75,000 |
| Family Pension | 1,50,000 |
| Lottery Winnings | 2,00,000 |
| Taxable Gift | 80,000 |
Assume an allowable family-pension deduction of ₹30,000 and no other deduction.
Computation
| Particulars | Amount (₹) |
|---|---|
| Dividend Income | 1,00,000 |
| Interest on Securities | 75,000 |
| Family Pension | 1,50,000 |
| Less: Family Pension Deduction | (30,000) |
| Taxable Family Pension | 1,20,000 |
| Lottery Winnings | 2,00,000 |
| Taxable Gift | 80,000 |
| Income from Other Sources | 5,75,000 |
Hence, Mr. F’s Income from Other Sources is ₹5,75,000. The lottery income remains included in the total, although its tax treatment/rate may be governed by special provisions.
