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Compensation for extinction of right to sue was capital receipt not chargeable to tax
Case Law Details
- Case Name
- M/s Chheda Housing Development Corporation Vs Addl. CIT (ITAT Mumbai)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Related Assessment Year
- 2012-13
- Courts
- All ITAT, ITAT Mumbai
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Chheda Housing Development Corporation Vs ACIT (ITAT Mumbai)
Conclusion: Where amount received by assessee in excess of advance was on account of compensation for extinction of its right to sue the owner, the receipt was a Capital receipt not chargeable to tax.
Held: During the assessment proceeding, AO noted that assessee had received Rs. 20 Crore as compensation, which was inclusive of advance of Rs.2.50 Crore paid by assessee. Assessee claimed the receipt of Rs. 20 Crore as capital receipt not chargeable to tax. Assessee received the said compensation under agreement for re...
