Sargam is a qualified doctor. She joined Arpana hospital as an employee on monthly salary. Their contract of service contained a clause restraining her to pursue practice beyond employment and paid her ₹ 3,00,000 as compensation for the same. The income will be taxable as:
A. The monthly salary will be taxable under Salary head and compensation as business income
B. The monthly salary will be taxable under Salary head and compensation as Income from other sources
C. The entire receipts would be taxable as salaries
D. The entire receipts would be taxable as Business income
Answer:C
Sargam is a qualified doctor. She joined Arpana hospital as an employee on monthly salary. Their contract of service contained a clause restraining her to pursue practice beyond employment and paid her ₹ 3,00,000 as compensation for the same. The income will be taxable as:
A. The monthly salary will be taxable under Salary head and compensation as business income B. The monthly salary will be taxable under Salary head and compensation as Income from other sources C. The entire receipts would be taxable as salaries D. The entire receipts would be taxable as Business income