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2022 (8) TMI 427 - AT - Income TaxCapital capital computation - expense deductible u/s 48 - payment made to a person who helped the assessee in obtaining favorable decision in her favour - it is apparently clear that right from the beginning of the agreement with that person that all the expenses involved in the process of obtaining vacant possession by evicting the Indian Navy would be borne by that person only - HELD THAT:- It is evident from the chronology of the events discussed (supra) and relying on the findings in the matter Mrs. Meher Rusi Dalal [2011 (9) TMI 1235 - ITAT MUMBAI], wherein coordinating bench of tribunal have allowed 33.33% of the total consideration to obtain a compensation as early as possible from the land acquisition authorities .Here also assessee availed the same services in the similar circumstances. A.O. and LD CIT (Appeal) himself observed that the matter was in litigation in court and compensation could be enhanced, if at all, only in a legal manner. It is not the case that there was no legal battle and just to avoid tax liability assessee as a matter of diversion of income opted for any colorable device by including Mr. Kishore Manusukhani the whole scenario of the matter clearly indicates that the assessee was suffering with the illegal occupancy of her land and requires a help to come out this adverse situation. Without any advance payment or any commitment to Mr. Kishore Manusukhani other than on successful outcome. This material fact can’t be ignored by the authorities below and this amount is clearly not a diversion of income rather it’s an expense deductible u/s 48 of the act. This amount is in extricable part of the whole transaction hence allowable u/s 48, in the result ground no 1 and 2 of the assessee are allowed and A.O. is directed to delete the disallowance while computing the income of the assessee. Cost inflation index (CII) till F.Y. 1994-95 instead of CII for Financial year 2010-11 - HELD THAT:- As in our considered view assessee is entitled for CII till F.Y. 2010-11 in the light of above Ground No. 3 of the appellant is allowed and A.O. is hereby directed to give effect of this finding while computing the income of assessee. Quantum of interest received by the assessee on compensation up to the date of land acquisition by the Ministry of Defense/Special Land Acquisition Officer pursuant to the Supreme Court order - Whether to be tax the same under the head 'Capital Gain' in terms of section 45(5)(b) r.w.s. 48 and the balance interest paid to assessee for any delay in payment of the compensation, from the date of acquisition of the property in pursuance to High Court/Supreme Court order, as 'Income from Other Sources'? - HELD THAT:- As interest paid to the assessee for any delay in payment of the compensation from the date of acquisition of the property in pursuance to Hon’ble Supreme Court order, the same should be taxed under the head “Income from other sources” and compensation with interest received by the assessee up to the date of land acquisition pursuant to the Hon’ble Supreme Court order should be taxed under the head “Capital Gains”. We confirm the view of Ld. CIT (A) and resultantly dismiss the ground of appeal taken by revenue on this issue. Deduction of 50% of that portion of the aggregate compensation received by the assessee liable to be taxed under the head “Income from Other Sources” - HELD THAT:- In this regard claim of the assessee is very much unambiguous and any income of the assessee falling under section 56(2)(viii) is liable for deduction @ 50% under section 57(iv). On this ground, we are not inclined to interfere with the findings of Ld. CIT(A), hence, this ground of Revenue is dismissed.
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