Case Law Details
Rohan and Rajdeep Infrastructure Vs DCIT (ITAT Pune)
ITAT Pune held that the amount received as compensation for pre-closure of BOT (Build, Operate, Transfer) project is capital receipt. Hence, treating the same as revenue receipt by invoking provisions of section 28(ii)(d) of the Income Tax Act is unsustainable in law.
Facts-
The assessee had received the impugned compensation amount i.e Rs. 18,51,61,000/- from the Government of Maharashtra in lieu of closure of its Build, Operate, Transfer “BOT” projects at three location. Both the lower authorities have invoked section 28(ii)(d) of the Act that such a compensation received partakes character of a revenue receipt as taxable income only.
It is alleged that the CIT(A) failed to appreciate that the amount received by the assessee was on account of pre-closure of its BOT projects and therefore, the same was a capital receipt and the provisions of section 28(ii)(d) of the Income Tax Act, 1961 were not applicable to the facts of the present case.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
