Right to sue for damages is capital receipts hence not taxable

Advertisement Virendra Bhavanji Gala Vs PCIT (ITAT Mumbai) ITAT Mumbai held that damage on account of right to sue is a capital receipt and accordingly not chargeable to tax. Facts- The assessee is an individual who entered into an MOU with Aadi Properties LLP with the intention to book commercial space to be developed and constructed in a proposed project by M/s. Aadi Properties LLP on a plot of land for consideration of Rs. 10,75,00,000/-. Accordingly, payment of Rs. 25,00,000/- by cheque drawn on the Bank of India was paid by the assessee. The amount was nearly 2.33% of the total conside...