9911796707
TMI Blog2000 (11) TMI 299X X X X Extracts X X X X X X X X Extracts X X X X ..... . 1985-86 to 1992-93 and are directed against the common order of CIT(A), Jodhpur, dt. 26th Sept., 1995, whereby he upheld the action of AO in assessing interest on compensation of land. 4. ITA Nos. 2121 to 2128/Jp/1995 are appeals by one assessee Sh. Kishore Singh for asst. yrs. 1985-86 to 1992-93 and are directed against the common order of CIT(A), Jodhpur, dt. 26th Sept., 1995, whereby he upheld the action of AO in assessing interest on compensation of land. 5. Representatives of both the sides have furnished their written submissions. We have gone through the written submissions of the rival sides and have also perused the records. 6. The facts in all the above 24 appeals are common. The facts, in brief, are that the agricultural lan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kanni Rubbers Ltd., (1973) 87 ITR 666 (Ker) wherein the Hon'ble Court, drawing distinction between compulsory acquisition of land by Govt. under the Land Acquisition Act, 1894 and that under any other law or agreement, held that in the latter case the property in land vests in the Government on passing of the award and so the interest paid from the date of taking over of possession of land by Government upto the date of award is in the nature of compensation for deprivation of use of land by the landowners/holders, and so is capital receipt and not revenue receipt, and accordingly not chargeable to income-tax. The Board's aforesaid Instruction/Circular was issued in the special fact-situation that the tax together with interest charged unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l the appeals, is as under:-- "That the assessment completed by the ITO is illegal and against law, in view of the instructions of CBDT F. No. 226/51/ITA-II dt. 29th Feb., 1996, because the instructions issued by the Board is binding upon the AO." In the aforesaid ground the Board's instruction has been mentioned as being F. No. "226" which has been wrongly mentioned as the correct No. is "225". In (1964) 53 ITR 151 (SC) the Hon'ble Supreme Court has held that when land is compulsorily acquired by the Government under Land Acquisition Act, 1894 (L.A. Act), the property in land vests absolutely in the Government on the date on which possession of land is taken over by the collector in view of the provisions of ss. 16 and 17 of L.A. Act and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of compensation was held to be taxable. In (1973) 87 ITR 666 the Hon'ble Kerala High Court drew a distinction between the possession of land assumed under the provisions of L.A. Act, 1894, and the possession otherwise taken. In the former case there was provision in ss. 16 and 17 of L.A. Act that on possession being taken the property will vest in the Government. In the latter case in the absence of any such statutory provision even when the possession was assumed by the Government whether under some provision of law or by agreement or unauthorisedly there remained deprivation of the property and so the interest paid by the Government was merely compensation for deprivation of such property. In the cited case the possession of land was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ources'. At the same time it was also stated that where the land was acquired under the L.A. Act the ratio of the Supreme Court judgment in the case of Shamlal Narula shall apply. Instructions of CBDT are undeniably binding on IT authorities. 10. We may also note that in similar circumstances in the cases of Shri Amar Sukh and Shri Mohan Ram, Tribunal, Jaipur has vide its common decision dt. 30th April, 1998, in ITA Nos. 2333 to 2341/Jp/1995 for asst. yrs. 1984-85 to 1992-93 and in ITA Nos. 2342 to 2350/Jp/1996 for asst. yrs. 1984-85 to 1992-93 set aside the assessment orders and restored the matters to AO to examine the issue afresh and decide on merits. Again from the perusal of record as contained in paper book submitted by the learned ..... X X X X Extracts X X X X X X X X Extracts X X X X
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