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TMI Blog1972 (10) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... amount awarded towards the compensation was found to be inadequate, the matter was taken before a court of law and the matter ultimately culminated in a compromise decree being passed by the Orissa High Court on May 9, 1963. As per the terms of that compromise the assessee was entitled to receive an extra compensation of Rs. 22,904 towards the value of the land and a further sum of Rs. 31,659 as interest at the rate of 6% per annum for the period during which the said extra compensation amount remained due to the assessee, The assessee received the extra compensation amount as well as the said sum of Rs. 31,659 on March 1, 1964. Both the date on which the compromise decree was passed as well as the date on which the assessee received the said amounts fell during the relevant previous year. The assessee disclosed an income of Rs. 1,260 being the interest accrued for the relevant assessment year. She, however, declared as the total amount of interest received, namely, the sum of Rs. 31,659, claiming that the entire amount of interest received during the relevant year was not chargeable to tax for that year. The Income-tax Officer held that the entire amount of interest, namely, R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be made on account of such acquisition, and it also provides for the payment of interest. Under section 11 of the Act, the Collector is required to make an award, among other things, fixing the compensation which, in his opinion, should be allowed for the land. Under section 18 of that Act, the matter can be got referred, at the instance of any person interested, by the Collector for the determination of the court, where an objection was taken, among other things, with respect to the amount of compensation also. If, in the opinion of the court, the Collector ought to have awarded as compensation a sum which is in excess of the sum which the Collector awarded as compensation, the court has been given the power, under section 28 of the said Act, to direct the Collector to pay interest on such excess at the rate of six per cent. per annum from the date on which he took possession of the land to the date of payment of such excess into court. It is not out of place to refer to section 34 of the said Act, as per which, when the amount of such compensation is not paid or deposited on or before taking possession of the land, the Collector was required thereunder to pay the amount aw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chargeable in respect of the total income of the previous year of every person, and the total income of any person for any previous year, under section 5 of the Act, includes all income from whatever source derived which accrued to him during such year, and the expression "income" is defined under section 2(24) of the Act to include, among other things, profits and gains, any capital gains chargeable under section 45, etc. What is manifest from the foregoing provision of law is that what is rendered chargeable for income-tax under the Act is only income as defined therein and that too only when it accrued, but not a claim to such an income. The difference, as has already been noticed, between being entitled to claim an amount and being entitled to receive the amount claimed, is too fundamental to be lost sight of while determining a question of this type in the context of section 5 of the Act. Till the income accrued to the assessee, as per the compromise decree passed on May 9, 1963, the assessee could not have been entitled to enforce that payment against the authorities concerned, in the sense that it was not rendered till then statutorily payable. Section 5 of the Act only spea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a certain sum is not compensation." The Bench of this court was called upon to deal with a case of compensation under the Land Acquisition Act in that case, but not with interest payable thereon, as is the case in the instant one. But the principle came to be laid down there by way of anological extension is equally applicable to the facts of the case, and applying that principle, we are of the view that the interest in this case is an income accrued to the assessee on the date on which the compromise decree was passed, namely, on May 9, 1963, when from it was rendered payable or enforceable. Our attention has been drawn to the case of Commissioner of Income-tax v. V. Sampangiramaiah . The assessee's property, there in that case, was acquired under the Land Acquisition Act and possession was taken on February 19, 1949. The Land Acquisition Officer's award was enhanced by the district judge as per the decree passed by him on February 28, 1951, and the same was further enhanced by the High Court and a sum of Rs. 1,15,000 representing the value of the land and an amount of Rs. 87,265 representing interest on that sum from that date was paid to the assessee on October 21, 1961. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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