TMI Blog2011 (5) TMI 964X X X X Extracts X X X X X X X X Extracts X X X X ..... in all these appeals, which reads as under:- Whether on the facts and circumstances of the case and in law the CIT(A) is correct in treating the amount received by assessee as capital receipt instead of revenue receipt since it is not derived by the assessee from any participation in business activity of the firm 2. At the time of hearing before us, the learned representatives of both the parties agreed that the issue involved in all the above appeals is similar to the case decided by the ITAT in assessee s own case for AY 2005-06, therefore, the decision of the ITAT in the said case may be followed in these appeals also. 3. We have heard the heard the learned representatives of the parties and perused the record. The ITAT in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id by the firm, the Revenue sought to tax the same. The Hon ble Patna High Court in that case of CIT vs. Mrs. Jaya Bhaskaran (supra) upheld the tribunal order by holding that the receipt was not taxable in the hands of the widow of the deceased. In holding so, reliance was also placed on the decision in the case of P.H. Divecha Vs. CIT (supra) wherein the Hon ble Supreme Court. In the said case of Mrs. Jaya Bhaskaran, the tribunal while deciding the issue following the case of P.H. Divecha (supra) has noted that the Hon ble Supreme Court observed that in determining whether this payment amounts to a return for loss of a capital asset or is income, profits or gains liable to income-tax, one must have regard to the nature and quality of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ital nor had rendered any service to the firm. At the same time, it is palpable that it was her deceased husband, who was partner in the firm, on whose death, the firm paid the said amount to the assessee. It is further important to bear in mind that it was not a onetime payment. Rather it continued to be paid by the firm to the assessee over the period as per the terms of the partnership deed. As the payment was towards the recognition of the valued services rendered by the partner during his life time and it was a sort of relief to the distressed family, and that too as per the terms of the partnership deed, it could not be said to have a revenue character in her hands. Therefore, in our considered opinion the payment received by the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The fact that, under cls. (i), (ii) and (iii) of s. 15(1), the compensation is paid as of right and in cases falling under cl. (d) of the proviso, it is a discretionary payment, would not stamp the payment with the character of revenue. The payment made by the Government is undoubtedly voluntary. However, it has no origin in what might be called a real source of income. No doubt s. 15(1), proviso, cl. (d) enables the applicant to seek payment but that is far from saying that it is a source. Therefore, it cannot afford any foundation for such a source. Further, it is a compassionate payment for such length of period as the Government may, in its discretion, order. Hence, the amounts received by the assessee during the financial years in qu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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