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2019 (10) TMI 143 - AT - Income TaxTaxability of interest received on enhanced compensation on compulsory acquisition of land u/s 28 of the Land Acquisition Act, 1894 - interest taxable u/s 56 or in the nature of compensation which was exempt from capital gain tax u/s 10(37) - HELD THAT:- Undisputedly the interest amount had been received u/s 28 of the Land Acquisition Act, 1894. We find that the nature of the said interest and its taxability had been settled by the Hon'ble Apex Court in its decision in the case of Ghanshyam, HUF [2009 (7) TMI 12 - SUPREME COURT] which has been reiterated by the apex court in the case of Gobind Bhai Mamaiya [2014 (9) TMI 587 - SUPREME COURT] and Hari Singh & Others [2017 (11) TMI 923 - SUPREME COURT] holding the same to be in the nature of compensation taxable as such. We hold that the interest received by the assessee during the impugned year on the compulsory acquisition of its land u/s 28 of the Land Acquisition Act, is in the nature of compensation and not interest which is taxable under the head income from other sources u/s 56 of the Act as held by the authorities below. The compensation being exempt u/s 10(37) of the Act is not disputed. In view of the same the order passed by the CIT(Appeals) upholding the addition made by the AO on account of interest on enhanced compensation is not sustainable. - Decided in favour of assessee
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