https://www.taxtmi.com/caselaws?id=8018 Compensation received for compulsory divestment of the management of a life insurance business was held to be a capital receipt, because the management formed part of the assessee-company's profit-making apparatus. The Court reasoned that the character of the receipt depended on the nature and purpose of the payment, not merely on the method of quantification. Although the amount was measured by reference to past profits under the Life Insurance (Emergency Provisions) Act, 1956, that did not convert it into income. The payment was therefore for loss of a capital asset, not taxable business profits. en-us Fri, 21 Aug 1970 00:00:00 +0530 Fri, 27 Mar 2009 11:22:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=8018 Compensation received for compulsory divestment of the management of a life insurance business was held to be a capital receipt, because the management formed part of the assessee-company's profit-making apparatus. The Court reasoned that the character of the receipt depended on the nature and purpose of the payment, not merely on the method of quantification. Although the amount was measured by reference to past profits under the Life Insurance (Emergency Provisions) Act, 1956, that did not convert it into income. The payment was therefore for loss of a capital asset, not taxable business profits. Case-Laws Income Tax Fri, 21 Aug 1970 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=8018