Income tax treatment
This query is : Resolved
Jimmy Thakur
(Querist)
26 November 2013
Hi,
I Need to know the Tax treatment if spouse of the deceased partner receives the Cash Settlement from the continuing partners of the partnership firm in which her husband was the partner.
Settlement Amount is derived as Value of Assets (Including Revalued Value of Property) minus value of Liabilities..
pls suggest will this be taxable in the hands of firm / partners or Not Taxable as all..
Thanks..
I Need to know the Tax treatment if spouse of the deceased partner receives the Cash Settlement from the continuing partners of the partnership firm in which her husband was the partner.
Settlement Amount is derived as Value of Assets (Including Revalued Value of Property) minus value of Liabilities..
pls suggest will this be taxable in the hands of firm / partners or Not Taxable as all..
Thanks..
Manish Bhandari
(Expert)
26 November 2013
Incase of revaluation of assets there is no Capital Gain as revaluation is a notional gain and not actually transfer.
As per my opinion it is neither taxable to the firm nor partners. It will be a capital receipt.
As per my opinion it is neither taxable to the firm nor partners. It will be a capital receipt.
26 November 2013
Agreed that it is a case of capital receipt not chargeable to tax as its not income as per defintion u/s 2 of income tax act.
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