Compensation for termination of MoU which enables assessee to carry on business of mining is a capital receipt on account of loss of ‘source of income’

The assessee is a Company and is engaged in the business of manufacturing and trading of facilities of sponge iron from iron ore, steel melting section for manufacturing of MS ingots from sponge iron and MS scrap, a rerolling mill for manufacturing of constructional and structural steels from MS ingots/billets. The assessee company entered into the Memorandum of Understanding (MOU) with Shri R.Charuchandra Prop. Of M/s Shree Nidhi Mines on 03.01.2004 for developing of mines, production/extraction of ore etc. for a period of 5 years from the date of renewal of mining lease that was extendable f...