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TMI Blog2016 (2) TMI 1087X X X X Extracts X X X X X X X X Extracts X X X X ..... eived by the assessee under section 28 of the Land Acquisition Act. Interest received under section 28 of the Land Acquisition Act is a part of the compensation itself. The compensation being exempt under section 10(37) is not disputed by any of the lower authorities in the present case. In view of the above, we direct the Assessing Officer to delete the addition made on account of interest on enhanced compensation - ITA No.313/Chd/2015, ITA No.314/Chd/2015, ITA No.315/Chd/2015, ITA No.316/Chd/2015, ITA No.317/Chd/2015, And ITA No.318/Chd/2015 - - - Dated:- 2-2-2016 - SHRI H.L.KARWA, VICE PRESIDENT, AND MS. RANO JAIN, ACCOUNTANT MEMBER For The Assessee : Shri Ajay Jain For The Department : Shri Jitender Kumar, DR ORD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 145A, clause (b) under the head income from other sources is taxable after giving 50% of deduction under section 57(iv) of the Act. After considering the reply of the assessee, the Assessing Officer concluded that the assessee has received enhanced compensation income aggregating to ₹ 30,93,458/- as principal amount and ₹ 79,15,893/- as interest on compensation and has claimed the same as exempt under section 10(37) of the Act. The Assessing Officer also observed that exemption under section 10(37) is available only on compensation on transfer and not on interest thereon. After applying the amended provisions of section 56(2), 57(iv) and 145A of the Act, applicable w.e.f. assessment year 2010-11, the Assessing Officer made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the assessee, dismissed the appeal of the assessee. His observations are at page 13, para 5.5, which read as under : 5.5 The clause (viii) has been inserted in section 56(2) by Finance Act, 2009 to provide that income by way of interest received on compensation or on enhanced compensation shall be assessed under the head 'income from other sources' in the year in which it is received applicable from A.Y. 2010-11 onwards. Further, section 145A has also been inserted by Finance Act, 2009 w.e.f. 01.04.2010. The section 145 A(b) provides that interest received by an assessee on compensation or on enhanced compensation shall be deemed to be the income of the year in which it is received. This shows that legislative intent is ve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e from other sources'. Therefore, the addition of ₹ 39,57,946/- is sustained. These grounds of appeal are dismissed. 8. Aggrieved by this, the assessee has come in appeal. The learned counsel for the assessee reiterated the submissions made before the lower authorities. His main limb of argument was that it is not in dispute that the assessee has received interest on compensation under section 28 of the Land Acquisition Act and as per the judgment in the case of Ghanshyam (HUF) (supra), the Hon'ble Supreme Court has very clearly held that the interest received under section 28 of the Land Acquisition Act is a part and parcel of compensation itself. Since the interest is part of compensation this is also exempt under sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of Sections 23, 23(1A), 23(2), 28 and 34 of the 1894 Act. As discussed hereinabove, Section 23(1A) provides for additional amount. It takes care of increase in the value at the rate of 12 % per annum. Similarly, under Section 23(2) of the 1894 Act there is a provision for solatium which also represents part of enhanced compensation. Similarly, Section 28 empowers the court in its discretion to award interest on the excess amount of compensation over and above what is awarded by the Collector. It includes additional amount under Section 23(1A) and solatium under Section 23(2) of the said Act. Section 28 of the 1894 Act applies only in respect of the excess amount determined by the court after reference under Section 18 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court is totally devoid of any ambiguity. It has been held in very clear term that interest received under section 28 of the Land Acquisition Act is a part of the compensation itself. The compensation being exempt under section 10(37) of the Act is not disputed by any of the lower authorities in the present case. 12. In view of the above, we direct the Assessing Officer to delete the addition made on account of interest on enhanced compensation. 13. The Ground No.2 challenges the validity of reopening by issue of notice under section 148 of the Act. Since we have allowed relief to the assessee on merits while adjudicating other grounds, this ground being a legal ground becomes academic and we do not find any need to adjudicate the sam ..... X X X X Extracts X X X X X X X X Extracts X X X X
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