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TMI Blog2014 (8) TMI 114X X X X Extracts X X X X X X X X Extracts X X X X ..... the mutual agreement between the parties, the price was stated in a notification by the Assessee, does not make it a compulsory acquisition – thus, in case of compulsory acquisition the seller has neither option to opt out of the acquisition nor can he negotiate the price - price was neither fixed by the statute nor by the principles stated but was agreed by the mutual negotiation - Tribunal has rightly held that there was no compulsory acquisition - Section 194 LA was not applicable – Decided against Revenue. - Tax Case No. 36 of 2013 - - - Dated:- 11-7-2014 - Yatindra Singh CJ And Goutam Bhaduri,JJ. For the Appellant : Shri Anand Dadariya For the Respondent : Shri S. Rajeshwar Rao JUDGMENT 1. The only point involved here is, 'Whether the land acquired by agreement by the Assessee under the Chhattisgarh Nagar Tatha Gram Nivesh Adhiniyam, 1973 (the Nivesh-Act) is compulsory acquisition within the meaning of section 194 LA of the Income Tax Act, 1961 (the IT-Act) or not?' It arises in this tax case that is filed against the order of the Income Tax Appellate Tribunal, Raipur Bench, Raipur (the Tribunal) dated 19.07.2013 allowing the appeal of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r in the facts and circumstances of the case, the acquisition by the Naya Raipur Development Authority is a compulsory acquisition or not; (ii) Whether in the facts and circumstances of the case, section 194 LA of the Income Tax Act, 1961 is applicable or not. However, the basic question in this appeal is mentioned in the opening paragraph of the judgement. In case it is decided in favour of the Department, then the matter is to be sent back to the Tribunal to decide the question whether the property was agricultural property or not. THE DECISION 13. The word 'compulsory acquisition' is not defined in the IT Act or for that matter in any other statute. However, it is expropriation or is done in exercise of 'eminent domain' the word, which was coined by 17th century jurist Grotius. 14. Halsbury's Laws of England, Volume 8(1), 4th Edition explains that 'Where land or an interest in land is purchased or taken under statutory powers See eg the Land Clauses Consolidation Act 1845 s 18; the Compulsory Purchase Act 1965 s 5 (as amended); and para 100 post. See also the Acquisition of Land Act 1981 s 2; and para 34 post without the agreement of the ow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... follows: (i) The seller has no option but to sell the land; (ii) The seller can not negotiate the price. It is fixed by the statute or determined under the principles mentioned therein. 17. There are many examples of such statutes. The Zamindari Abolition Acts, Ceiling Acts, Nationalisation Acts are examples of such compulsory acquisition but the most prominent law regarding compulsory acquisition of immovable property is the LA-Act. 18. The first law for compulsory acquisition of immovable property was contained in Bengal Regulation I of 1824. Similarly, the Building Act XXVIII of 1839 as well as Act XX of 1852 provide compulsory acquisition of land in Bombay as well as in Madras Presidency. 19. The aforesaid enactments were replaced by the Act VI of 1857. This was supplemented by Act XXII of 1863. These statutes were consolidated and replaced by the Act 10 of 1870, which in turn was replaced by the LA-Act. 20. The preamble of the LA-Act explains that it was enacted 'to amend the law of the acquisition of land needed for public purposes and for Companies and for determining the amount of compensation to be made on account of such acquisition'. 21. Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elopment Authority of Chhattisgarh'. It provides that the Town and Country Development Authority can acquire the land by agreement and in case of failure of agreement, then it is to be acquired under the LA-Act (for section see below) Section 56 of the Chhattisgarh Nagar Tatha Gram Nivesh Adhiniyam, 1973 is as follows:- 56. Acquisition of land for Town and Country Development Authority or Housing and Urban Development Authority of Chhattisgarh. - The Town and Country Development Authority or Housing and Urban Development Authority of Chhattisgarh may at any time after the date of publication of the final town development scheme under section 50 but not later than three years therefrom, proceed to acquire by agreement the land required for the implementation of the scheme and, on its failure so to acquire, the State Government may, at the request of the Town and Country Development Authority or Housing and Urban Development Authority of Chhattisgarh, proceed to acquire such land under the provisions of the Land Acquisition Act, 1894 (No.1 of 1894) and on the payment of compensation awarded under that Act and any other charges incurred by the State Government in connection wit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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