https://www.taxtmi.com/caselaws?id=188442 Lump sums received for keep-out covenants under patent-licensing arrangements were capital receipts, because the exclusive licences formed part of the assessee's fixed capital structure rather than stock-in-trade. The payments were not calculated by reference to actual or anticipated user; instead, they were part of the consideration for the substantial disposal of territorial rights and the related restraint on competition. Royalty amounts separately referable to use were treated as income, but the lump sums were linked to the surrender of part of the capital apparatus for earning profits and were therefore not taxable as income. en-us Wed, 05 Apr 1967 00:00:00 +0530 Thu, 01 Dec 2016 11:11:36 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=188442 Lump sums received for keep-out covenants under patent-licensing arrangements were capital receipts, because the exclusive licences formed part of the assessee's fixed capital structure rather than stock-in-trade. The payments were not calculated by reference to actual or anticipated user; instead, they were part of the consideration for the substantial disposal of territorial rights and the related restraint on competition. Royalty amounts separately referable to use were treated as income, but the lump sums were linked to the surrender of part of the capital apparatus for earning profits and were therefore not taxable as income. Case-Laws Income Tax Wed, 05 Apr 1967 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=188442