https://www.taxtmi.com/caselaws?id=277218 Whether a termination payment is taxable as business income turns on its connection with the business profits; the note applies the principle that a compensation or solatium paid for compulsory termination of agency/distribution contracts lacks nexus with the continuance or generation of business profits and therefore falls outside the business heads of income. Applying that test, the payment received on termination of distribution agreements is classified as non-revenue in nature and not assessable as business income under the Income-tax Act; the operative effect is that such receipts are not taxable as profits of business. en-us Wed, 26 Sep 1951 00:00:00 +0530 Thu, 29 Nov 2018 12:06:03 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=277218 Whether a termination payment is taxable as business income turns on its connection with the business profits; the note applies the principle that a compensation or solatium paid for compulsory termination of agency/distribution contracts lacks nexus with the continuance or generation of business profits and therefore falls outside the business heads of income. Applying that test, the payment received on termination of distribution agreements is classified as non-revenue in nature and not assessable as business income under the Income-tax Act; the operative effect is that such receipts are not taxable as profits of business. Case-Laws Income Tax Wed, 26 Sep 1951 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=277218