Income tax treatment

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Jimmy Thakur (Querist)
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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..

Manish Bhandari

Manish Bhandari (Expert)
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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.

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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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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