IT/ILT : Settlement amount received by FIIs who had invested in company's shares/ADS for giving up right to sue the company for damages caused by fraud in financial statements is capital receipt and is not taxable. Settlement amount is a compensation for not pursuing the suit and involves surrender of capital asset of "right to sue". The capital asset "right to sue" cannot be transferred in terms of section 6(e) of the Transfer of Property Act. Even if surrender of right to sue can be treated as
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