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TMI Blog2017 (12) TMI 1792X X X X Extracts X X X X X X X X Extracts X X X X ..... part of consideration received in respect of agricultural land specified us.2(14)(iv) . Assessee argument stating that spreading of interest received to different assessment years - The assessee in this case had not demonstrated that it is following mercantile system of accounting. Hence, it is to be taxed on cash system basis i.e. receipt basis. This ground of appeal is also rejected. A.R submitted that proper opportunity of hearing to the assessee by the lower authorities was not offered during proceedings - There is a violation of principles of natural justice. Before me, the ld.A.R is not able to demonstrate how the opportunity is not given by the lower authorities in prosecuting the case before them. In the absence of any mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of taxable total income without assigning proper reasons and justification. 4. The CIT (Appeals) failed to appreciate that the assessment of the net consideration/interest at ₹ 38,78,515/- after granting deduction u/s 57(4) of the Act was wrong, erroneous, unjustified, incorrect and not sustainable in law. 5. The CIT (Appeals) failed to appreciate that the conclusions reached to tax the interest on the enhanced compensation for the acquisition of the exempted capital asset especially on the misconstruction of the provisions of section 145A (b) of the Act were wrong, erroneous, unjustified, incorrect and not sustainable in law. 6. The CIT (Appeals) went wrong in recording the findings in this regard in para 5.3.2 of the imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this, interest was ₹ 77,57,030/-. Out of this, deduction at 50% was granted u/s 56(2)(viii) r.w section 57(iv) of the Act and the AO brought the balance amount of ₹ 38,78,5151- by re-opening of assessment u/s.147 of the Act. Aggrieved by the order of ld. Assessing Officer, the assessee objected the re-opening of assessment before the ld. Assessing Officer as well as before the Ld.CIT(A). 4. Before Bench, at the time of hearing, the ld.A.R did not press the ground relating to re-opening of assessment. Accordingly, this ground stands dismissed as not pressed. 5. However, the ld.A.R submitted that interest received on compulsory acquisition of agricultural land is nothing but enhanced compensation on the land acquired by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction of tax at source under section 194A- Held, yes Section 194-LA of the Income-tax Act, 161 - Deduction of tax at source - Acquisition of certain immovable property, compensation payment - Whether interest accrued on delayed payment of amount of enhanced compensation in respect of acquisition of agricultural lan4 would partake character of compensation for agricultural land which is excluded from operation of section 194LA- Held, no B. Tuhi Ram v. Land Acquisition Collector [1993] 66 Taxman 127 (Punjab Haryana) Section 2(14)(iii) of the Income-tax Act, 1961 - Capital asset - Agricultural land - Whether sub-clause (iii) of clause (14) of section 2 is ultra vires - Held, no. Section 2(1A) of the Income-tax Act, 1961 - Agricu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation from non-taxable - Held, no In my opinion, Ld.CIT(A) has rightly placed reliance on the above judgements and held against the assessee. Hence, I do not find any infirmity in the order of the CIT(Appeals) and the same is confirmed. This ground of appeal raised by assessee is rejected. 8. Before me, the assessee placed one more argument stating that spreading of interest received to different assessment years. In my opinion, the assessee in this case had not demonstrated that it is following mercantile system of accounting. Hence, it is to be taxed on cash system basis i.e. receipt basis. This ground of appeal is also rejected. 9. Further, ld.A.R submitted that proper opportunity of hearing to the assessee by the lower autho ..... X X X X Extracts X X X X X X X X Extracts X X X X
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