9911796707
TMI Blog2012 (7) TMI 756X X X X Extracts X X X X X X X X Extracts X X X X ..... rded in Land Acquisition cases, present petitions have been filed. 2. Short facts of the case are that in all the petitions, execution cases were filed by the petitioners, wherein prayer was that respondent No. 1 be directed to pay compensation along with interest and other benefits. Respondent No. 1 deposited the amount payable to the petitioners and submitted that as per section 194-LA of the Income-tax Act a sum of Rs. 34,95,833/- has been deposited by the respondent No. 1 in all the execution petitions on 10.6.2009 with the Income-tax Department. It is submitted that thus the execution petitions be dismissed in full satisfaction. After hearing the parties learned Court below dismissed the execution petitions in full satisfaction agains ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... having no authority to deduct the TDS. Learned counsel placed reliance on a decision in the matter of Mysore Urban Development Authority v. ITO [2008] 175 Taxman 307 (Kar.) wherein Karnataka High Court had an occasion to consider the word "agricultural land" within the meaning of Section 194LA and has observed that in a case of compensation for acquisition of agricultural land main part of Section 194LA itself excludes agricultural land from the immovable property covered by Sec. 194LA as the words in the brackets i.e. 'other than agricultural land' indicate that there is no obligation cast on a person to deduct tax while distributing compensation for agricultural land located at any place including in an urban agglomeration. Learned counse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d hence tax will have to be deducted at source under this Section from the interest payments made to the public under the Land Acquisition Act." 6. Learned counsel submits that Ujjain Development Authority was duty bound to deposit the TDS failing which the consequences are laid down under Section 271-C of the Income-tax Act, which reads as under :- "271C. Penalty for failure to deduct tax at source (1) If any person fails to - (a) deduct the whole or any part of the tax as required by or under the provisions of Chapter XVIIB; or (b) pay the whole or any part of the tax as required by or under, - (i) sub-Section (2) of Section 115-0; or (ii) second proviso to Section 194B, then, such person shall be liable to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the consequences of Section 271C of the Income-tax Act, the amount was deposited by respondent No. 1 on 10.6.2009. It is submitted that petitions have no merit and the same be dismissed. 8. Ms. Veena Mandlik, counsel for the Income-tax Department, submits that no illegality has been committed by the Ujjain Development Authority in deducting the Tax at Source (in short TDS) as it is deducted only on the amount of interest paid to the claimants and not on the compensation. Learned counsel submits that in the matter of Risal Singh (supra) wherein the deduction was made by the Collector on the amount of compensation, Punjab & Haryana High Court allowed the writ petition and remitted the case holding that since the land was agricultural lan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h was payable to each of the petitioners on account of interest out of which the amount deducted towards TDS and the amount paid to each of the petitioner is shown in the chart hereinbelow. S. No Case No. Name of Petitioner Total amount of compensation Total amount of Interest Amount of TDS Balance amount deposited in the Court 1. 12/07 Rameshwar 67,42,206/- 41,60,380/- 4,71,371/- 62,70,835/- 2. 11/06 Radhyashyam Ambaram 32,35,749/- 19,77,202/- 2,24,017/- 30,11,732/- 3. 6/07 Bharulal 42,62,279 26,05,814 2,95,239 18,92,814 4. 7/06 Sagarmal 15,12,113 9,23,976 95,170 14,16,943 5. 7/07 Rugnath 39,35,430 24,05,989 2,72,599 36,62,831 6. 10/07 Ratan Singh 1,34,01,063 82,69,326 9,36, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rder and in the case of K.S. Krishna Rao v. CIT [1990] 181 ITR 408/[1991] 54 Taxman 334 (SC) it was held that where a compensation awarded under the Land Acquisition Act or on further appeals, interest on enhanced compensation cannot be taxed all in a lump sum as having accrued on the date on which the Court passes order for enhanced compensation; the interest has to be spread over on annual basis right from the date of delivery of possession till the date of order on a time basis, petition filed by the petitioner is disposed of with a direction that respondent Ujjain Development Authority shall issue Form No. 16-A to the petitioners upon receipt of Permanent Account Number (PAN) by the petitioners forthwith upon submission of return by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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