https://www.taxtmi.com/caselaws?id=276325 Compensation received for transferring or cancelling a contract entered into in the ordinary course of business is a revenue receipt, not a capital receipt, even where the contract is substantial or concerns a single transaction. The assessee's parachute purchase contract was part of his trading operations, so the consideration received for its transfer was taxable as trading income. The alternative argument that the payment represented relinquishment of partnership rights also failed, because the record did not establish a completed partnership and the later arrangement treated the earlier understanding as cancelled, with the assessee transferring the contract individually for consideration. The receipt was therefore liable to income-tax. en-us Sun, 29 Sep 1996 00:00:00 +0530 Tue, 06 Nov 2018 12:27:11 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=276325 Compensation received for transferring or cancelling a contract entered into in the ordinary course of business is a revenue receipt, not a capital receipt, even where the contract is substantial or concerns a single transaction. The assessee's parachute purchase contract was part of his trading operations, so the consideration received for its transfer was taxable as trading income. The alternative argument that the payment represented relinquishment of partnership rights also failed, because the record did not establish a completed partnership and the later arrangement treated the earlier understanding as cancelled, with the assessee transferring the contract individually for consideration. The receipt was therefore liable to income-tax. Case-Laws Income Tax Sun, 29 Sep 1996 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=276325