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2010 (10) TMI 581 - HC - Income TaxCapital gain - Compulsory acquisition of land - Method of accounting - whether the interest on enhanced compensation received by the assessee is exigible to tax in the year of receipt or at the time when the lis regarding compensation for the acquired land attains finality - In order to constitute income, the receipt must come as a return from a definite source which is of the character of income according to the ordinary meaning of that word - Under cash system, the income is exigible to tax only on the basis of actual receipt irrespective of the fact, whether the same had arisen or not whereas mercantile system envisages accrual or arising of income or deemed to accrue or arise during the year in question - it is clear that interest directed by the Collector partakes the character of compensation and forms part thereof under Section 34 of the Act whereas the interest ordered by the Court falls under Section 28 of the Act - Appeal is allowed
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