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TMI Blog2023 (6) TMI 564X X X X Extracts X X X X X X X X Extracts X X X X ..... m other sources in the hands of the recipient land owners under section 56 of the Act and therefore, the LAO was not under any legal obligation to comply with the TDS provisions of section 194A of the Act. Decided in favour of assessee. - ITA No. 4019/Del/2019 - - - Dated:- 16-5-2023 - SHRI SHAMIM YAHYA , ACCOUNTANT MEMBER AND MS. ASTHA CHANDRA, JUDICIAL MEMBER For the Assessee : Shri Pramod Jain, CA For the Department : Shri Sumit Kumar Verma, Sr. DR ORDER PER ASTHA CHANDRA, JM The appeal filed by the assessee is directed against the order of the Ld. Commissioner of Income Tax (Appeals)-5, Ludhiana ( CIT(A) ) dated 13.02.2019 pertaining to the Assessment Year ( AY ) 2015-16. 2. The grounds raised by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issued to the assessee remained uncomplied with. The ITO (TDS) therefore passed order under section 201(1) and 201(1A) of the Act on 28.12.2017 and raised a demand of Rs. 2,10,82,026/- consisting of TDS @ 20% which comes to Rs. 1,58,51,147/- on interest paid i.e. Rs. 7,92,55,734/- and interest @ 1% for 33 months for non payment of TDS of Rs. 52,30,879/-. 4. On appeal filed by the assessee before the Ld. CIT(A), the assessee did not get any relief. This has bought the assessee before the Tribunal and all the grounds of appeal relate thereto. 5. At the very outset, the Ld AR submitted that the issue is covered by the decision of the Tribunal in assessee s own case for AY 2010-11, 2011-12 and 2012-13 in favour of the assessee on identic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tional High Court in the case of Jagmal Singh (supra) and during appellate proceedings filed an affidavit that interest on enhanced compensation was paid to the recipient land owners under section 28 of the LA Act and submitted that the provision of section 194A do not apply for the reason that interest under section 28 is a part of the amount of compensation itself. It was pointed out that there is vital difference between interest awarded under section 28 and interest paid under section 34 of the LA Act. Interest under section 28, unlike under section 34 is an accretion in value and regarded as part of the compensation itself which is not the case of interest under section 34 of the LA Act. Interest under section 34 is for delay in making ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cultural land situate in any area referred to in item (a) or item (b) of section 2(14)(iii) by way of compulsory acquisition under any law is exempt from tax under section 10(37) of the Act. Accordingly, any income by way of capital gains engrained in the receipt of compensation and/ or enhanced compensation is exempt in the hands of the recipient land owners. This is obvious from the reading of the provisions of section 10(37) of the Act. 8. In the light of the legal provisions set out above and following the judgment of the Hon ble Supreme Court in Ghanshyam (HUF) (supra), we hold that interest received by the land owners on enhanced compensation awarded to them by the court under section 28 of the LA Act is not in the nature of inc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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