Assessee entered into a property purchase agreement in 2005, paying Rs.14 lakhs. However, due to a title defect, property couldn’t be transferred, and seller refunded Rs. 28 lakhs in 2012-It was noted that upon seller’s inability to execute sale deed for land in favour of assessee, both parties reached a compromise to resolve dispute amicably. They mutually decided to abandon their claims under initial agreement to sell, with assessee relinquishing right to have land registered in their name. In exchange, assessee received a payment of Rs. 28 lakhs. The  payment received by assessee was acknowledged as relinquishment of their rights to have property registered in their name, initially acquired through agreement to sell. The Assessing Officer assessed the amount as income from other sources. CIT(A) up held the order of the Assessing Officer. On appeal the Tribunal held that act of relinquishment qualified as a capital asset, making it eligible for treatment under head capital gains. Accordingly the-compensation for such relinquishment so received is chargeable to tax under head Capital gains and amount initially paid would be treated as cost of acquisition for acquiring such rights.  Therefore, income had been rightly offered to tax under head Capital gains and same could not be brought to tax under head Income from other sources. (AY. 2012-13)