Seeking views on an open point. Delhi HC in CIT v. Pritam Das Narang [2015] 61 taxmann.com 322 (Delhi) held that compensation received from a prospective employer for non-commencement of employment (offer withdrawn before joining) is a capital receipt, not "profits in lieu of salary" u/s 17(3)(iii), since that section presupposes an actual employer-employee relationship. Followed CIT v. Rani Shankar Mishra [2010] 320 ITR 542 (Delhi).

Query: Section 56(2)(x)(xi), inserted by Finance Act 2018 w.e.f. 1-4-2019, brings to tax compensation received "in connection with the termination of employment or modification of terms and conditions relating thereto" under Income from Other Sources.

Has this new residuary clause been applied/tested (by any ITAT/HC ruling, CBDT circular, or in practice) to a fact pattern where employment never commenced at all (i.e., "denial of employment" as opposed to "termination/modification" of an existing employment)? Would appreciate any citations or practical experience on this specific point for AY 2025-26 filing.