DURGA DAS KHANNA vs COMMISSIONER OF INCOME-TAX, CALCUTTA

The Supreme Court held that the amount of Rs. 55,200 received by the assessee for the construction of a cinema house was not taxable as advance rent under the Income Tax Act. The Court found that the lease did not stipulate the payment as advance rent, and the transaction was business-like, indicating a capital receipt rather than revenue. The Court emphasized that the classification of premium as capital or revenue depends on the facts of each case, and in this instance, the payment had characteristics of a capital payment.