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TMI Blog1970 (4) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... 51, hereinafter called the " Act ", the Jagirs were abolished with effect from December 4, 1952. Under section 8 of the Act compensation was payable to him in accordance with the principles laid down in Schedule I. Under sub-section (2) of that section the compensation payable became due as from the date of the resumption of the jagir. Simple interest was payable at the rate of 2 1/2 % per annum from that date up to the date of payment on the amount of compensation which was payable within a period of ten years in annual instalments. The assessee maintained that the amount of interest formed part of the compensation and constituted a capital receipt. The Income-tax Officer held against the assessee and included the interest in his income. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resentative-in-interest. Under section 12 every jagirdar whose jagir land had been resumed under section 3 had to file in the prescribed form a statement of claim for compensation before the Jagir Commissioner within two months from the date of resumption. On receipt of a statement of claim the Jagir Commissioner was to determine the amount of compensation payable to the jagirdar under section 8 as also the amounts recoverable from him under section 4(1)(e) and other matters mentioned in section 13. Under section 14 the amount recoverable from a jagirdar was to be deducted from the compensation payable to him under section 8. Section 15 provided for payment of compensation money. According to sub-section (1) after the amount of compensati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the interest which is payable under sub-section (2). The compensation has to be determined in accordance with the principles laid down in Schedule I. That schedule indicates that the determination of compensation had nothing to do with the payment of interest. The marginal heading cannot control the interpretation of the words of the section particularly when the language of the section is clear and unambiguous. This court has held in Dr. Sham Lal Narula v. Commissioner of Income-tax, that the statutory interest paid under section 34 of the Land Acquisition Act, 1894, on the amount of compensation awarded for the period from the date the Collector has taken possession of the land compulsorily acquired is interest paid for the delayed paymen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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