TMI Blog2012 (10) TMI 477X X X X Extracts X X X X X X X X Extracts X X X X ..... - SUPREME COURT] interest is different from compensation as interest paid on the excess amount under Section 28 depends upon a claim by the person whose land is acquired whereas interest under Section 34 is for the delay in making payment. As the amount in question is to be treated as part of compensation itself and is not to be treated as interest. Therefore, the question of law framed above ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . This question does not survive in view of the pronouncement of the judgment of the Apex Court that the interest payable under Section 28 of the Land Acquisition Act, 1894 is a part of compensation and is not interest at all and therefore, must be taxed as compensation. 3. A reference may be made to the judgment of their Lordships of the Hon ble Supreme Court in Commissioner of Income Tax, Fari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sation. It is equally true that Section 45(5) of the 1961 Act refers to compensation. But as discussed hereinabove, we have to go by the provisions of the 1894 Act which awards interest both as an accretion in the value of the lands acquired and interest for undue delay. Interest under Section 28 unlike interest under Section 34 is an accretion to the value, hence it is a part of enhanced compen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... later on. Hence, the year in which enhanced compensation is received is the year of taxability. Consequently, even in cases where pending appeal, the court/tribunal/authority before which appeal is pending, permits the claimant to withdraw against security or otherwise the enhanced compensation (which is in dispute), the same is liable to be taxed under Section 45(5) of the 1961 Act. This is the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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