https://www.taxtmi.com/caselaws?id=18941 Compensation paid to a retiring partner for surrendering his share in a partnership was treated as a capital receipt because it represented consideration for loss of an income-producing source, not a mere incident of trading profits. The governing test is whether the payment ends a trading arrangement while leaving the recipient's income structure intact, in which case it is revenue, or whether it impairs the source of income or trading structure, in which case it is capital. Applying that principle and the binding precedent relied on, the amount paid on retirement did not constitute trading income and was therefore assessable as capital in nature. en-us Thu, 28 Sep 1995 00:00:00 +0530 Tue, 03 Nov 2009 10:13:04 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=18941 Compensation paid to a retiring partner for surrendering his share in a partnership was treated as a capital receipt because it represented consideration for loss of an income-producing source, not a mere incident of trading profits. The governing test is whether the payment ends a trading arrangement while leaving the recipient's income structure intact, in which case it is revenue, or whether it impairs the source of income or trading structure, in which case it is capital. Applying that principle and the binding precedent relied on, the amount paid on retirement did not constitute trading income and was therefore assessable as capital in nature. Case-Laws Income Tax Thu, 28 Sep 1995 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=18941