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TMI Blog2012 (10) TMI 322X X X X Extracts X X X X X X X X Extracts X X X X ..... f Sec. 2(14) and liable to tax u/s. 45 – Held that:- Following the decision in case of B.C. Srinivas Shetty (1981 (2) TMI 1 - SUPREME COURT) that right of lifting of water was acquired by assessee without any cost. Hence no capital gain could be worked out since Sec. 45(1) r.w.s. 48(1) are not applicable in respect of payment made to assessee in lieu of surrender the right to lift the water from well filled for widening of road. Appeal decides in favour of assessee - ITA NO. 421/ PN/2011 - - - Dated:- 16-7-2012 - Shri Shailendra Kumar Yadav and Shri G.S.Pannu, JJ. Appellant by : Sri S.P. Joshi Ms. Kirti Joshi Respondent by : Dr. Santosh Kumar ORDER PER SHAILENDRA KUMAR YADAV JM : This appeal has been fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld to be his pious hope and not a direction to correct any such possible or alleged mistake . 2. The assessee was the owner of the agricultural land situated at Survey No.162/1 2/1, Hadapsar, Pune, on which a well was existing. The said land was acquired for Public Works Department of Maharashtra State Government through Land Acquisition Proceeding by concerned Land Acquisition Collector vide award dated 17-07-1986. Accordingly assessee s compensation for above said land was determined at Rs.99,683/- and paid to assessee in Financial Year 1986- 87. Same was offered to taxation as Long Term Capital Gains Tax in Return of Income filed for assessment year 1987-88 which is not in dispute. Copy of award dated 17-7-1986 by concerned Land Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... saction is liable to tax u/s. 45 of the Income Tax Act. Therefore, the Assessing Officer levied capital gains thereon after reopening the case. 3. The matter was carried out before the appellate authority wherein the order of Assessing Officer was confirmed. The same has been opposed before us. The Authorised Representative submitted that land as well as well were already acquired for road widening vide the award made by the concerned land acquisition officer on 17-07-1986 for which compensation was paid to the assessee. The said award dated 17-07-1986 has been placed at Page Nos. 1 to 17 of the Paper Book filed on behalf of the assessee. It was further submitted on behalf of the assessee that inspite of the acquisition by way of the abov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in the case of (1981) CIT Vs. V.C. Srinivas Shetty (SC), no capital gains would be worked out since provisions of section 45(1) r.w.s. 48(1) are not applicable in respect of transfer of such assets. In this background it was submitted that an amount of Rs. 15 lakhs received is not enhanced compensation. It is in lieu of foregoing right to draw water from a well subsequent to acquisition of said land as stated above. Learned Authorised Representative submitted that CIT(A) erred in holding that it is liable to capital gain. On the other hand Departmental Representative submitted that Assessing Officer was justified in holding that amount of compensation received of Rs. 15 lakhs is enhanced compensation for acquiring right to draw water from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount of Rs.15 lakhs was paid for abandoning the right of lifting of water from the well. As stated above as goodwill gesture State Government allowed assessee to lift water from well situated on his acquired land at nominal rent of Rs. 1/- per annum after acquiring said agricultural land along with well thereon. It is settled legal position that award of Land Acquisition Officer can be challenged by way of reference before the concerned Revenue Officer/Appellate Authority under the section 18 of the Land Acquisition Act, 1894. As stated above, there is nothing on record to suggest that enhancement proceedings has been preferred by assessee before the concerned Revenue Officers/Appellate Authority under the relevant provisions of section 18 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... limit area of road was put at disposal of P.M.C. who assigned the road widening work to Serum Institute of India. There is nothing on record to suggest that assessee has acquired the right of lifting of water from said well for any consideration. There is also nothing on record to suggest that the right of lifting water from said well at rate of Rs.1 per year had any nexus to acquisition of land in question. In this situation it cannot be said enhanced compensation because the assessee has not challenged award in question at Survey No. 162 vide award dated 17-07-1986 under relevant provisions of Land Acquisition Act, 1894. Subsequent payment is in lieu of abandoning right to lift water from well, which was acquired by assessee without incu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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