TMI Blog2014 (1) TMI 848X X X X Extracts X X X X X X X X Extracts X X X X ..... y payments as provided under the divorce agreement. The assessee was to receive monthly alimony which was to be taxable in the each year from conclusion of divorce agreement but in this case monthly payments were not received and, therefore, were not offered tax - The receipt by the assessee represents accumulated monthly installments of alimony which has been received by the assessee as a consideration for relinquishing all her past and future claims - there was sufficient consideration in getting this amount - thus, section 56(2) (vi) is not applicable – the amount was a capital receipt not liable to tax – Decided against Revenue. - ITA No. 644/DEL/ 2012 - - - Dated:- 14-6-2013 - Rajpal Yadav And T.S. KAPOOR, JJ. For the Appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ul Dax, a national of Germany and ex-husband who has stated as under: "MS. Meenakshi Khanna is my ex-wife and that I have sent her US $ 99,093 during the month of August, 2007." 4. The Assessing Officer show caused the assessee as to why not the amount received be added to the income of assessee as per provisions of section 56(2) (vi) of the Act. In response, assessee submitted her reply by letter dated 18.10.2010 stating as under: "This is regarding the amount of 99,093 US $ received in our saving a/c from US. It is stated that the above said amount received from her ex-husband Dr. Paul Dax for which confirmation has been given earlier. This amount has been received as alimony from ex-husband as per divorce agreement in August 1990. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reme Court and compared with the definition given in section 2(d) of Contract Act and approved as being practically the same in Chidambara Iyer V. Renga Iyer (1966) 1 SCR 168. Going by these definitions it cannot be said that the appellant received the money without consideration which is a prerequisite condition for invoking clause (vi) of sub-section (2) of section 56 of the Act because appellant in the facts received the amount against consideration of relinquishing her personal right of claiming monthly maintenance as provided under law. In view of the above of the fact that amount was received against consideration the addition made by Ld. Assessing Officer of the alimony received is deleted. Proceeding further with the second ques ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceipts of alimony were income taxable under the Act. 8. The Ld. AR on the other hand, argued that there was an agreement for custody, separation and divorce on 01.12.1989 and divorce finally took place on 20.04.1990 and till the date of divorce they were husband and wife and money was received pursuant to this agreement and the husband of assessee had agreed to pay this money in installments over a period of time which he did not honour and, therefore, the wife threatened for execution of divorce agreement and her husband, therefore, parted with the amount as full and final settlement in lieu of past monthly non payments and in lieu of future payments. It was further argued that the amount received was not without consideration and rather ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lusion of divorce agreement but in this case monthly payments were not received and, therefore, were not offered tax. The receipt by the assessee represents accumulated monthly installments of alimony which has been received by the assessee as a consideration for relinquishing all her past and future claims. Therefore, we held that there was sufficient consideration in getting this amount and, therefore, section 56(2) (vi) is not applicable. Moreover, if the Revenue's arguments are to be accepted of it being monthly payments liable for tax as per Bombay High Court order, then also the amounts represented by past monthly payments can not be taxed in this year. Therefore, we held that amount was a capital receipt not liable to tax. In view ..... X X X X Extracts X X X X X X X X Extracts X X X X
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