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Compensation for business termination resulting in Income Source Loss is Capital Receipt
Case Law Details
- Case Name
- DCIT Vs Rishabh Infrastructure Pvt. Ltd. (ITAT Raipur)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Related Assessment Year
- 2011-12
- Courts
- All ITAT, ITAT Raipur
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DCIT Vs Rishabh Infrastructure Pvt. Ltd. (ITAT Raipur)
Conclusion: Compensation received by assessee on closure of business activity was for sterilization of the profit making apparatus of assessee-company; therefore, the same was capital receipt.
Held: In the case of Karam Chand Thapar & Brokers (P) Ltd. Vs. CIT reported in 80 167 it was held that where, on a consideration of the circumstances, payment is made to compensate a person for cancellation of a contract which does not affect the trading structure of his business, nor deprive him of what in substance is his source of income, term...
