Allowing the appeal the Revenue the Court held  that under the operating agreement the assessee was authorised to run and operate hotel with all the employees, staff including managerial staff of ELEL Hotels and Investments Ltd. No right, title or interest of any kind was created by ELEL in favour of the assessee in any of the assets or properties of  Hotels and Investment Ltd   to carry on the commercial activity of operating the hotel Hotel SeaRock,    ELEL was to get 23 per cent. of the gross turnover as licence fees, subject to some variations as provided in the agreement. Considering the terms of the licence operating agreement in its entirety, it was a trading contract. Accordingly the   the sum received by the assessee by way of arbitral award from ELEL for relinquishment of right to operate its hotel SeaRock under the operating licence as mentioned in clause 3(n)(iv) of the consent terms was in terms of a trading contract to settle all disputes, claims and counter claims, and was not the transfer of any capital asset. The amount was part of the arbitral award received by the assessee to finally adjust, compromise and settle all disputes, allegations, claims, counter claims and case pending in courts arising out of or relating to operating licence agreement to run the hotel SeaRock.  Held  that from Classical Economists distinction point of view also, the receipts on arbitral award from ELEL being not for transfer or loss of any capital asset but at best was in lieu of circulating capital introduced to operate the hotel SeaRock   and was a revenue receipt which arose from the trading contract of operating licence agreement. The assessee had no fixed capital investment to run the hotel SeaRock  under the operating licence agreement and according to the agreement, the assessee had introduced some circulating capital to run it. Mere use of the word “relinquishment” in the settlement agreement and in the consent terms, without disclosing any rights in any capital asset or relinquishment of any rights in any capital assets, was not decisive rather established that the receipt was not capital receipt. Therefore, the receipt is  revenue in nature consequently forming part of assessee’s income. Order of Tribunal is set aside.  (AY. 2006-07)