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Taxability of hardship compensation

Dileep (Accountant) (82 Points)

25 November 2015

I have received "HARDSHIP COMPENSATION' from biulder on redevelopment of our society. Will this amount be taxable Silimer to amount received as salary part namely city compensatory allowance received by an employee when he has to stay in a city for job and incur extra expenditure and hardships, which is taxable.

If this is not taxable then under which section or rule or is there similer case study for this for Non taxability of such amount received

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4 Replies

ABHIMANYU JHAMBA (partner) (146 Points)
Replied 26 November 2015

Can u pls explain the nature of the so called HARDSHIP COMPENSATION.

Dileep (Accountant) (82 Points)
Replied 26 November 2015

Builder is paying us CORPUS amount on redevelopment of society; stating as "HARDSHIP COMPENSATION

(Guest)

Did the flat owners get this amount or the cooperative society?

According to the decision of the Bombay Tribunal in the case of Lohtse Co-operative Housing Society Ltd vs Seventh Income-tax Officer r the said corpus fund received by you is in the nature of capital receipt and not taxable. but this issue is not free from doubt.