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2019 (10) TMI 921 - AT - Income TaxAssessibility of the amount received u/s 28 of the Land Acquisition Act - assessee pointed out that land of the assessee was acquired against which it received compensation u/s 28 of the Act, which was part of additional compensation received and not taxable - HELD THAT - As decided in SHRI AMAR CHAND GUPTA, 2019 (8) TMI 1424 - ITAT DELHI assessees had received interest u/s 28 of Land Acquisition Act on enhanced compensation. The Hon ble Supreme Court in the case of CIT vs Ghansham (HUF) 2009 (7) TMI 12 - SUPREME COURT has clearly held that interest received by the assessee in view of section 28 of Land Acquisition Act 1894 is part of the compensation and therefore was not taxable. The Hon ble Delhi Bench of the Tribunal in the case of Shri Opinder Singh Virk, 2019 (5) TMI 676 - ITAT DELHI has dealt with the decision of the Hon ble Supreme Court in the case of Chet Ram (HUF) 2017 (9) TMI 1532 - Supreme Court as well as the case laws of Ghanshyamdas and after analysing the same has again held that interest receipt on enhanced compensation u/s 28 of the Land Acquisition Act is in the nature of compensation. - Decided in favour of assessee
Issues Involved:
1. Assessibility of the amount received under Section 28 of the Land Acquisition Act. Detailed Analysis: Issue: Assessibility of the amount received under Section 28 of the Land Acquisition Act The primary issue in the appeal was whether the amount received under Section 28 of the Land Acquisition Act (LAC Act) should be considered taxable. The appellant argued that the enhanced compensation received under Section 28 of the LAC Act was part of the compensation and thus not taxable. The Revenue, on the other hand, contended that this amount should be taxed as interest. Tribunal's Findings: The Tribunal referenced similar cases, notably the case of the assessee's cousin, where the same issue had been previously adjudicated. The Tribunal had consistently held that the interest received under Section 28 of the LAC Act is part of the compensation and not taxable. This stance was supported by the Supreme Court's decision in CIT vs. Ghansham (HUF), which unequivocally stated that interest received under Section 28 of the LAC Act is part of the compensation and hence not taxable. Relevant Precedents: 1. CIT vs. Ghansham (HUF): The Supreme Court held that interest received under Section 28 of the LAC Act is part of the compensation and therefore not taxable. 2. Shri Opinder Singh Virk: The Delhi Bench of the Tribunal upheld that interest received on enhanced compensation under Section 28 of the LAC Act is in the nature of compensation. 3. Shri Manish Yadav: The Tribunal reaffirmed its position, dismissing the Revenue's appeal and holding that the interest received under Section 28 of the LAC Act is not taxable. 4. Hari Singh Case: The Supreme Court directed that if compensation was received for agricultural land, the tax deposited should be refunded, reinforcing the non-taxable nature of such compensation. Conclusion: The Tribunal, following the established judicial precedents, concluded that the amount received under Section 28 of the LAC Act is in the nature of compensation and not taxable. Consequently, the appeal filed by the assessee was allowed, and the grounds of appeal raised by the assessee were upheld. Order: The Tribunal pronounced the order in the open court on 18th October 2019, allowing the appeal of the assessee.
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