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TMI Blog1982 (3) TMI 143X X X X Extracts X X X X X X X X Extracts X X X X ..... n respect of which the date of notification was the same as in item (i) but possession was assumed on 9-1-1967. In respect of the aforesaid items the assessee returned different values but in essence claimed large discounts for hazards of litigation, delay in securing compensation, etc., and pleaded for only much lower values being taken than what were finally awarded or even returned. The WTO broadly took the view that finally awarded compensation, interest and solatium thereon should be the true index. 2. The assessee appealed to the AAC who stated that the Land Acquisition Officer (LAO) awarded compensation on 21-9-1970 at Rs. 2,000 per acre and the Additional Chief Judge on a petition for enhancement decided the issue on 27-9-1973 awarding Rs. 2 per sq. yd. There was also a mention in the order of the AAC that certain persons filed a suit claiming that they were protected tenants of part of land in Survey Nos. 223 and 224, i.e., item (ii) aforesaid. The assessee, it would appear as ascertained by us, had contended that there were protected tenants only in respect of 2 acres 10 guntas out of the total area of 33 acres 7 guntas and the assessee's claim was upheld by the Additio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enhancement, etc. 6. The next contention put forth was that in the assessment years 1971-72, 1972-73 and 1973-74, matters were pending before the civil court which gave its decision only on 27-9-1973 and here again the value of compensation receivable should be heavily discounted. 7. In particular the learned counsel submitted that in respect of the second item, there was litigation regarding the extent of area which was under protected tenancy and in respect of this litigation also, a further discount should be given. It was stated that the discount allowed by the AAC was totally inadequate. 8. He then relied on certain judicial pronouncements. He referred to the decision of the Andhra Pradesh High Court in CWT v. G.M. Omar Khan [1981] 127 ITR 543. This was a case of acquisition under the Requisitioning and Acquisition of immovable Property Act, 1952 ('the RAIP Act') and certain compensation was determined by the Collector. But, however, the compensation paid was only Rs. 14,05,536 against the compensation of Rs. 21,08,304 determined by the Collector. There was an arbitration proceeding pending. It was stated that though the assessee in that case had made a claim for about ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee also relied on certain decisions of the Tribunal such as those in WT Appeal Nos. 625 to 632 (Hyd.) of 1976-77 dated 24-9-1977 and WT Appeal Nos. 11 to 16 (Hyd.) of 1979 dated 27-6-1980 to state that the Tribunal had fixed a percentage of 25 per cent of the right to receive enhanced compensation in the first case as being in order and 20 per cent of the right to receive compensation in the second case as being in order. 12. Another point highlighted by the learned counsel for the assessee was that in evaluating the market value, due regard should be had to the general principle as to what money, if invested for the particular number of years which it took between acquisition of the property and awarding of compensation, would yield the amount of compensation after the specified period. This amount, he submitted, would have to be discounted further for the hazards of litigations, disputes regarding title to the property, etc. 13. The learned departmental representative, on the other hand, submitted that the basis evolved by the AAC in the present case was eminently reasonable. He also referred to different decisions of the Tribunal where a somewhat similar percentag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty that has passed to the accountable persons determined.... " These observations show that the claim which an assessee may make to receive enhanced compensation is also something which cannot be ignored just like the dispute relating to land which is in the possession of protected tenants. It was in such circumstances that the matter was restored to the Tribunal for fresh decision. 17. Coming to the case of G.M. Omar Khan we have to point out that it was a case where the Government had not accepted the compensation amount and what is more, there was a rival claim lodged by another person claiming a share in the entire compensation amount. The Government appointed an arbitrator for adjudicating the dispute between the assessee and the other claimant. The Hon'ble High Court noticed in the course of the judgment that there was a prospect of the amount awarded by the Collector being reduced. This was possible in respect of acquisition proceedings under the RAIP Act as against proceedings under the Land Acquisition Act. It was in view of the special features mentioned that their Lordships came to the conclusion that a higher value than what was received with reference to the award ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt in the cases of Estate of Mohd. Sultan and G.M. Omar Khan. 20. An argument was placed before the Andhra Pradesh High Court on behalf of the revenue having regard to the decision of the Supreme Court in Pandit Lakshmi Kant Jha v. CWT [1973] 90 ITR 97 that a percentage even higher than 50 per cent should be taken for the right to receive compensation because in respect of Zamindari Abolition Bonds, the right to receive compensation taken by the Tribunal at 65 per cent in the case of Pandit Lakshmi Kant Jha's case had been upheld by the Supreme Court. Their Lordships of the Andhra Pradesh High Court have pointed out the difference between obtaining compensation payable under the Bihar Zamindari Abolition Act and under the Land Acquisition Act. The relevant observations in this regard are of Amatul Kareem's case and read as under : " The last contention raised by Mr. Rama Rao, learned counsel for the revenue, is that while in Pandit Lakshmi Kant Jha v. CWT [1973] 90 ITR 97, the Supreme Court had determined the net wealth of the assessee at 65 per cent of the compensation payable, in the present case, the net wealth is determined at 50 per cent of the compensation. The determinat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er 10 years, the market value or the bonds was to be taken at 40 per cent of the face value, if it was 9 years, 45 per cent was to be taken, if it was 8 years, 50 per cent was to be taken and so on and so forth. The exact table is as under : --------------------------------------------------------------------------------------------------------------------------------------------------- No. of years, after the valuation date, when Percentage of face value of the bond becomes repayable or if payable in bond to be taken. instalments, the last instalment becomes payable --------------------------------------------------------------------------------------------------------------------------------------------------- 9 years 45 per cent 8 years 50 per cent 7 years 55 per cent 6 years 60 per cent 5 years 65 per cent 4 years 75 per cent 3 years 85 per cent 2 years 95 per cent 1 year 100 per cent --------------------------------------------------------------------------------------------------------------------------------------------------- The aforesaid circular, in our view, recognises also the principle that the more delayed the award of compensation, the lo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tantial justice may result if such a course is adopted particularly when details are lacking of the claims made at various stages by the assessee as well as the State if they are in appeal, etc., though it may mean keeping the revision of the assessments themselves pending for some time. 24. If we view the present case from the aforesaid angle, we find that notification was made in 1966 and possession was entered in 1967, the award by the LAO came 3 years later in 1970 and the enhancement by the city civil court another 3 years later, i.e., in 1973. Thereafter, in respect of the first and third items of property the matter became final and in respect of the second item of property the disputes between the tenants and the assessee went on for another four years, i.e., up to 1977. We have already set out the percentage of the face value of the bonds to be taken as prescribed by the Board's Circular No. 2-D (WT), dated 15-5-1964 where the last payments are to be made after a certain number of years. So also in the present case the award of the city civil court, which became final in two instances, was rendered after a certain number of years from the relevant valuation dates. The ea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctors and circumstances. 26. While a computation on the basis set out by us would be in order till such time as the LAO gives his award, from the date the LAO gives his award the amount to be taken would be the amount awarded by him plus a percentage of the enhanced compensation which may finally be awarded taking into account the time period from the date of his award to the date of final compensation. This is because the amount payable cannot in any case be lower than that awarded by the LAO in the land acquisition proceedings unlike under the RAIP Act where the Government could contest the initial award. 27. In the present case, therefore, regarding the first and third items, we would direct the values to be recomputed with reference to particular valuation dates in accordance with our aforesaid directions. 28. As far as the second item is concerned, the protected tenants had put in claims against the assessee and it was eventually settled by way of compromise by which the assessee was required to pay out from the compensation received a sum of Rs. 1,35,000. We would direct here also that the percentages be taken as aforesaid with reference to the final net compensation wh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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