If the amount is lump sum then the same shall be treated as a capital receipt and not liable to tax. However, if the money is received on recurring or regular basis then it will partake the nature of income and would be liable to tax.
Since this is a lump sum payment, the same is in the nature of capital receipt and there shall be not tax implications. However, merely for the sake of disclosure, I recommend that it be shown by the recipient as "Exempted Income." while filing the return, although it's not an income.
[You have the option to not to show this as exempted income. It's just a recommendation.]