Go AD-FREE with CAclubindia Pro and Daily WhatsApp Updates. Subscribe Now!

Taxability of hardship compensation

Tax queries 2037 views 4 replies

Dileep

Accountant

83 Points Joined February 2013

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

Replies (4)

ABHIMANYU JHAMBA

partner

146 Points Joined August 2013

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

Dileep

Accountant

83 Points Joined February 2013

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.