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2018 (9) TMI 2115 - AT - Income TaxIncome from other sources - compensation received as interest income of the assessees - not considering the same as part of the compensation received u/s 28 of the Land Acquisition Act, 1894 - whether provisions of section 56(2)(viii) were not applicable in cases where agricultural land is involved? - As per DR it was not clear from the judgment relied upon by the Ld. AR as to whether the interest was in the nature of compensation or not - HELD THAT - We restore all the six appeals to the office of the respective Assessing Officer (s) with the direction to determine as to whether the interest paid amounted to compensation or not and follow the judgment as rendered in the case of CIT vs. Ghanshyam HUF ( 2009 (7) TMI 12 - SUPREME COURT as has been directed in case of Union of India Ors. Vs.Hari Singh Ors. 2017 (11) TMI 923 - SUPREME COURT . We also direct the respective AO(s) to provide reasonable opportunity to the assessees before the adjudicating the issue as per law and as per the directions of the Hon ble Apex Court as aforesaid. We also direct the respective assessees to fully co-operate with the assessment proceedings. Appeals of assessees stand allowed for statistical purposes.
Issues involved:
The judgment involves the challenge of treating compensation received as interest income under the head 'income from other sources' instead of considering it as part of the compensation received under section 28 of the Land Acquisition Act, 1894. Analysis: 1. ITA No. 685/Del/2017: The assessee, an agriculturalist, had their rural agricultural land acquired by a corporation for industrial development. The issue revolved around the denial of the claim of exempt income u/s 10(37) of the Income Tax Act, treating it as interest income. The ITAT directed the Assessing Officer to determine whether the interest paid was part of the compensation as per the judgment in CIT vs. Ghanshyam (HUF). 2. ITA No. 686/Del/2017: Similar to the first case, the compensation awarded was claimed as exempt u/s 10(37) but was treated as interest income. The ITAT directed the Assessing Officer to verify if the interest paid amounted to compensation as per relevant legal precedents. 3. ITA No. 6042/Del/2016: The issue here was the denial of the claim for exemption on the compensation awarded. The ITAT directed the Assessing Officer to determine if the interest received was part of the compensation, following the legal position established in previous judgments. 4. ITA No. 4163/Del/2017: In this case, the compensation awarded was claimed as exempt but was treated as income from other sources. The ITAT directed the Assessing Officer to ascertain if the interest formed part of the compensation as per relevant legal interpretations. 5. ITA No. 6615/Del/2016: The denial of exemption on the compensation received led to the challenge before the ITAT. The Assessing Officer was directed to examine if the interest received was indeed part of the compensation, in line with legal principles. 6. ITA No. 5765/Del/2016: The issue centered around the denial of the claim for exemption on the compensation received. The ITAT directed the Assessing Officer to determine whether the interest formed part of the compensation, following established legal interpretations and judgments. In all cases, the ITAT directed the Assessing Officers to evaluate whether the interest paid under the Land Acquisition Act was indeed part of the compensation, considering relevant legal precedents. The decision was based on the interpretation of the law as laid down by the Hon'ble Apex Court, emphasizing the need for a thorough assessment following the principles established in key judgments.
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