|I must tackle that statement, "Not a poem," since there are a couple of indicators that, actually, it is. The fact that it is written in lines that look very much like verses set the scene and then the capital letter given to the word "gently," following a comma tends to confirm that impression. If you're serious about the piece not being poetry, it may be necessary to change these indicators.
The form of 50 words exactly is much to my liking and I wish the contest was still going. There are similar ones (Tweet Me a Story for instance) but nothing quite as abbreviated as this. I was involved in one that closed recently, 24 Syllables, but that was poetry rather than prose.
Your piece fits the purpose of the contest very accurately, I think, since it includes a wealth of detail and food for thought within those few words. The contrast between the tramp's gnarled hands and the ethereal handkerchief is particularly eloquent (quite poetic in fact) and the reader is struck by the meeting of two worlds, the light, airy world of the handkerchief and the sad, despairing tramp that reaches to bring something of beauty into his world. It is most fitting that, in spite of the denial from the policeman, the world of beauty reaches out in turn to the tramp, the handkerchief landing on his boot as if wanting to stay with him.
And that final sentence is where there may be need of more accuracy. The phrase, "As he shuffled off," seems to relate to the policeman since he is mentioned immediately beforehand. Some doubt on this is cast by the word "shuffle" as coppers do not usually shuffle along. But doubt returns with the inroduction of a boot to catch the handkerchief. Cops may not shuffle but tramps rarely have the means to wear boots.
These are easy to fix, however, and it should not prove too difficult to rephrase within the 50 word limitation. The piece is excellent, providing much for the reader to ponder and, perhaps, even to return to read again. Most enjoyable (and yes, I did read it several times to catch all the nuances).