https://www.taxtmi.com/caselaws?id=55845 A retiring partner's settlement amount was treated as capital in nature when received in lieu of partnership rights on discontinuance of the business source. The additional payment made by continuing partners towards the retiring partner's tax liability was not taxable as business income in the later year, because it arose only under an arbitration settlement after cessation of the business connection. On the stated facts, the receipt did not amount to a taxable transfer and was not chargeable as capital gains. The earlier year's treatment of share-of-profit amounts was confined to the facts accepted there, and the cited contrary reasoning was found inapplicable. en-us Sat, 31 Jul 1982 00:00:00 +0530 Tue, 30 Nov 2010 13:48:08 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=55845 A retiring partner's settlement amount was treated as capital in nature when received in lieu of partnership rights on discontinuance of the business source. The additional payment made by continuing partners towards the retiring partner's tax liability was not taxable as business income in the later year, because it arose only under an arbitration settlement after cessation of the business connection. On the stated facts, the receipt did not amount to a taxable transfer and was not chargeable as capital gains. The earlier year's treatment of share-of-profit amounts was confined to the facts accepted there, and the cited contrary reasoning was found inapplicable. Case-Laws Income Tax Sat, 31 Jul 1982 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=55845