Assessing Officer and submitted that it was a closure of
business and, therefore, retrenchment compensation is not allowable. He
relied on the decision ... mill was maintaining separate
accounts, but due to closure of oil mill, retrenchment compensation was
paid. The Tribunal found that entire requirement of funds
foreclosed owing to breach of contract and
damages were paid as compensation for closure of contract. In light of
aforesaid judgments, the assessee is entitled
lead to severe adverse consequences including the defending suits for compensation, or otherwise closure of its operations, etc., the same acquires the nature
Essar Steel Ltd. vs Deputy Cit on 30 September, 2005
Equivalent citations: [2005]97ITD125(AHD
dispute of well settled legal proposition that the retrenchment compensation
paid on account of closure of business cannot be considered to be
expenditure incurred
case on hand
the compensation has been received for sterilization of source of profit resulting
into closure of business, therefore it has to be treated ... appellant. Various conditions of the closure agreement also clearly show
that it is a closure of \ business as the appellant has returned all the machineries
appellant is not as a
compensation in connection with the loss of employment due
to closure of concern of the employer and therefore ... compensation as defined and shown above for any loss or
obligation under law. The word "compensation ", in the context
is therefore meaning less
erred in holding that the
payment of Rs.7 lakhs is a compensation for employers' obligation
under law. The employer had paid separately ... closure of concern of the employer and
therefore, is not taxable u/s. 17(3)(i) of the Act. The term
compensation is defined
State Bank Of Saurashtra vs Deputy Commissioner Of Income Tax on 31 December, 2004
Equivalent
amicably with the workers. As per the amicable solution the
company paid compensation to the employees on their resignation from
the service. Subsequent to their ... compensation was paid to maintain the continuity of the business and the
said payment was not made at the time of the closure
