Deferred consideration contingent on uncertain future event cannot be taxed before vesting of right to receive

Brief of the case:

The Hon’ble Bombay High court in the above cited case held that a consideration receivable by the transferor which is contingent on happening of a future event the outcome of which is uncertain and cannot be predicted with a reasonable degree of certainty. Such a consideration cannot be said to have accrued merely on execution of agreement and can be taxed only on the vesting of right on favorable outcome of the event.

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