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TMI Blog1982 (3) TMI 142X X X X Extracts X X X X X X X X Extracts X X X X ..... ion, possession of land was taken on 25-9-1970 on which date the Land Acquisition Officer also passed an award. By this award compensation of Rs. 88,755 was awarded as also solatium at 15 per cent, i.e., Rs. 13,313 making an aggregate of Rs. 1,02,068. This compensation was received shortly thereafter and it is not in dispute that it was duly accounted for in the books prior to 31-3-1971 which was the valuation date relating to the assessment year 1971-72. 4. There was a reference by the assessee seeking enhancement of the compensation awarded. This matter came to be decided in O.P. No. 59 of 1971 by the court of the sub-judge, Visakhapatnam. The date of judgment was 5-2-1974 which date fell prior to 31-3-1974, i.e., the valuation date relevant to the assessment year 1974-75 and obviously prior to 31-3-1975, the valuation date relevant to the assessment year 1975-76. By this judgment the sub-judge awarded enhanced compensation which was fixed a Rs. 6,90,667, 15 per cent solatium was also awarded. This came to Rs. 1,03,000 making a total of Rs. 7,94,267. Deducting the compensation and solatium originally awarded of Rs. 1,02,068, the assessee, in terms of the judgment of the sub-jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en at 20 per cent of that awarded by the city civil court. He submitted that the AAC had referred to some other orders of the Tribunal in coming to this conclusion. According to him, the percentage of 50 taken by the AAC was unrealistic and, therefore, he pleaded for a significantly lower percentage being adopted particularly because the appeal in the High Court was still pending and the assessment years now under consideration were years prior to that in which the successor AAC had himself adopted a percentage of only 20. 8. The learned counsel also referred to the Circular of the CBDT No. 2-D(WT), dated 15-5-1964 [see Taxmann's Direct Taxes Circulars, vol. 1, 1980 edition, p. 1028] wherein the Board had prescribed certain percentages of the face value of Zamindari Abolition Compensation Bonds which were to be taken having regard to the number of years over which the payment was to be made. His submission was that in the case of such bonds, the amount of the bond was fixed and it was only the period of payment which was postponed. Yet, he submitted, where payment was to be made after a period of 9 years or more, only 45 per cent of the value was to be taken. Where the bonds them ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge of 50 was not to be taken, a lower percentage could be taken. 12. At the time the present appeals were argued, we also had occasion to hear another set of appeals in Smt. D. Kamalabai [WT Appeal Nos. 540 to 546 (Hyd.) of 1981] wherein similar contentions were put forth on behalf of the revenue as well as on behalf of the assessee. In that case we have considered at some length the various contentions and our order in that case is dated 5-3-1982. Since we had occasion to deal with such contentions in these appeals, we thought that it would be advantageous if the parties are again heard on the basis of our order in that case so that the arguments could be crystallized further. We have, accordingly, heard the learned counsel for the assessee and the learned departmental representative with reference to our findings in that order wherein we have tried to enunciate some sort of principles which may have a general application. We do not recount, because it is not necessary, the entire arguments which we have set out in detail in the aforesaid order. Suffice it to say that our broad conclusion was that it would be reasonable to take the percentages as prescribed by the Board's Circul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount of compensation should be taken as the proper percentage for determining the net wealth of an assessee in a case where the net wealth comprises of the right to receive the compensation. That must necessarily depend, as observed by the Supreme Court, on a consideration of all the relevant factors and circumstances of the case." 13. The submission of the learned counsel in the present case was that the compensation matter had not yet been finally decided and it was still pending in the High Court and, therefore, the percentages, as fixed by us in the case referred to, should be further discounted. The learned departmental representative, on the other hand, contended that the percentage of 50 by which we directed the percentages prescribed by the circular of the Board to be discounted was on the high side. 14. We have considered the rival submissions. Looking to the nebulous nature of the compensation to be awarded under the Land Acquisition Act till it is finally decided and considering that a large number of years often pass before matters are concluded and having regard to the ratio of the judgment of the Supreme Court in Mrs. Khorshed Shapoor Chenai v. A. CED [1980] 122 I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was a matter of descretion of the Court. Having heard the learned departmental representative again, we are inclined to adhere to our earlier conclusion because what we have to determine is the market value of the right to receive a certain amount and when the right to receive such amount is in the pure discretion of the Court, we consider that it would virtually have no marketable value on an earlier date as in that case a willing buyer is not likely to make any payment towards a probable awarding of interest which is in the discretion of the Court. Therefore, for the earlier years, we would come to the conclusion that there is no question of adding any value for the interest which was eventually awarded. 17. We now take up the appeals of the revenue, i.e., WT Appeal Nos. 399 and 400 (Hyd.) of 1981. The assessee in the present case was a dealer in real property. He had made his own valuation of the land which was acquired and of which possession was taken on 25-9-1970 in relation to the valuation dated 31-3-1969 and 31-3-1970. On 31-3-1969 the value shown was Rs. 1,06,145 and on 31-3-1970 it was Rs. 1,44,414. The WTO was of the view that the value of enhanced compensation as fix ..... X X X X Extracts X X X X X X X X Extracts X X X X
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