2022 (6) TMI 1371

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..... ompensation received by the appellant against compulsory acquisition of agricultural land along with interest as income from other sources in spite of the fact that such compensation being on agricultural land was exempt from income-tax. (b) That, on the facts and in the circumstances of the case, the Ld. C.I.T.(A) further erred in having upheld the addition of Rs.89,46,065/- unlawfully made by the A.O. in spite of the fact that as per Hon'ble Supreme Court decision amount awarded u/s. 28 of Land Acquisition Act, 1894 is accretion in value of land and interest therein forms part of compensation, which is beyond the scope of levying any income-tax. (c) That, the Ld. C.I.T.(A) grossly erred in having denied to take any cognizance to the C .....

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..... to explain the mismatch between closing balance of capital as per balance sheet as on 31.03.2012 and opening balance as on 01.04.2013. 3) That as the order of Ld. CIT(Appeals) on the above issues suffers from illegality and is devoid of any merit, the same should be quashed and your appellant be given such relief(s) as prayed for." 3. During the year, the assessee has received Rs.2.58 Cr. on account of compulsory acquisition of his land comprising an amount of Rs.79.17 lacs on account of compensation and Rs.178.92 lacs on account of interest on land compensation, the fact of which is not in dispute. The AO treated the interest u/s 56(2)(viii) r.w.s. 145A(b) and allowed deduction u/s 57(iv). 4. The ld. CIT(A) confirmed the order of the A .....

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..... discussed above, I am of the opinion that the AO has rightly treated the interest received on enhanced compensation as income from other sources and has duly granted deduction u/s 57(iv) of the Act @ 50% of the interest received. Accordingly, the addition made by the AO is confirmed and the ground of appeal is dismissed." 5. Thus, we find the ld. CIT(A) grossly ignored the judgment of Hon'ble Supreme Court in the case of CIT Vs. Ghanshyam (HUF) and difference between interest received u/s 28 and Section 34 and interest received u/s 37 of the Income Tax Act, 1961. The interest u/s 28 is a part of the amount of compensation whereas interest u/s 34 is only for delay in making payment after the compensation is determined. Interest u/s 28 is a .....

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