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TMI Blog2012 (9) TMI 220X X X X Extracts X X X X X X X X Extracts X X X X ..... ter of the land as ancestral property. When the assessee has taken a specific stand in the reassessment proceedings that the compensation awarded belongs to the HUF as the land acquired was an ancestral property belonging to the HUF, the AO was not justified in totally ignoring the claim of petitioner without examining it while completing the assessment. The CIT (A) has also not recorded any finding with regard to the ancestral character of the land - restore the matter to the file of the AO to re examine the assessee’s claim - in favour of assessee for statistical purpose. - ITA Nos. 98 to 101/Hyd/2011 - - - Dated:- 22-6-2012 - SHRI CHANDRA POOJARI, SHRI SAKTIJIT DEY, JJ. Appellant by Sri S. Rama Rao Respondent by Shri K. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pensation for acquisition of the agricultural land and, therefore, is a compensation and not interest. iv. The ld. CIT (A) ought to have considered the fact that the word interest is defined under the IT Act and the amount received by the appellant cannot be termed as interest within the meaning of IT Act and, therefore, the same is not liable for taxation as a separate source of income. 3. In ground Nos.1 and 2, the assessee has challenged the assessment on the ground that the compensation and interest earned on acquisition of land belongs to the HUF. Facts of the case, in brief, are that for the assessment year 2002-03, the assessee filed return declaring a total income of Rs.2,05,092/-. In the return of income, the assessee has dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A) that the assessee had made a specific plea before the AO objecting to the initiation of proceedings u/s 147 since the compensation received does not belong to the assessee in his individual capacity but belongs to the HUF. In support of his contention, the assessee also produced various documents like the order passed by the Land Reforms Tribunal and pahani patrika to prove the fact that the nature and character of the agricultural land acquired is an ancestral property belonging to the HUF. The CIT (A) however did not accept the contention of the appellant on the ground that in the judgment of Hon ble AP High Court, the name of the respondent is clearly mentioned as B. Narendra Reddy and not as B. Narendra Reddy, HUF. The CIT (A) furthe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e documents clearly established the fact that the property acquired by the Government for which compensation was paid belonged to the HUF of the assessee and not to him as an individual. Therefore, the assessment made u/s 143(3) read with section 147 of the Act in his individual capacity assessing the compensation income received is legally unsustainable. 6. The learned DR, on the other hand, contended that the assessee himself having shown the compensation received in his individual capacity, he cannot go back on his earlier stand when the AO sought to assess the interest received on the compensation amount by taking this stand that the income belongs to the HUF. The learned DR supported the action of the revenue authorities. 7. We h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een properly examined by the revenue authorities with reference to the evidence produced before them, we think it proper to restore the matter to the file of the AO who shall examine the assessee s claim with regard to the assessability of the compensation and interest received on acquisition of agricultural land after examining all evidences produced before him. If on the basis of the evidence produced, the assessee is able to prove that the land acquired actually belong to the HUF, then no assessment of compensation and interest can be made at the hands of the assessee in his individual capacity. With the aforesaid observation, we restore the matter back to the file of the AO who shall complete the assessment after affording a reasonable ..... X X X X Extracts X X X X X X X X Extracts X X X X
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