PRATIMA REDDY MUTHU,HYDERABAD vs. ACIT., CIRCLE-14(1), HYDERABAD

ITA 1310/HYD/2025Status: DisposedITAT Hyderabad24 December 2025AY 2010-11Bench: SHRI VIJAY PAL RAO (Vice President), SHRI MANJUNATHA G. (Accountant Member)1 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the compensation received was in the nature of capital receipt and not revenue income. It also noted that the income would accrue only upon the final disposal of appeals, not on the interim stay.

What were the facts?

The assessee, widow of a contractor, received compensation awarded by a Civil Court for contractual disputes. The High Court granted an interim stay on the decree, allowing the assessee to withdraw 50% of the decretal amount. The assessee declared a portion of the compensation as income and the balance as capital receipt.

What were the issues?

Whether the compensation received by the assessee is revenue income or capital receipt, and when the income accrues for taxability.

Which sections of the Income-tax Act were involved?

Section 14,Section 28,Section 148,Section 151,Section 159,Section 171,Section 250

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Income Tax Appellate Tribunal, Hyderabad ‘A’ Bench, Hyderabad

Before: SHRI VIJAY PAL RAO & SHRI MANJUNATHA G.

Hearing: 24.11.2025

PER VIJAY PAL RAO, VICE PRESIDENT :

This appeal by the Assessee is directed against the Order dated 07.07.2025 of the learned CIT(A)-National Faceless Appeal Centre [in short “NFAC], Delhi, for the assessment year 2010-2011. 2 ITA.No.1310/Hyd./2025

2.

The assessee has raised the following grounds:

1) That the impugned order passed by Ld. CIT (Appeal) under section 250 of Income Tax Act, 1961 being contrary to the schematic and purposive interpretation of provisions of Income Tax Act, 1961 and perverse of record is liable to be set aside. 2) That Ld. CI

The order continues below.

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