2024 (8) TMI 1581 - AT - Income Tax

Addition of interest received on enhanced compensation u/s. 56(2)(viii) r.w.s.57(iv) and section 145A(b) - assessee argued that the interest received is nothing but a compensation on acquisition of the agricultural land hence not liable to tax - HELD THAT - Action of the AO in bringing to tax the interest received on enhanced compensation is in conformity with the provisions of section 57(iv) r.w.s.56(2)(viii) r.w.s.145A(b) of the Act. The ld.CIT(A)/NFAC had rightly confirmed the action of the Assessing Officer - Decided against assessee.

Summary

The Appellate Tribunal (ITAT Pune) dismissed the assessee's appeal against the National Faceless Appeal Centre (NFAC), Delhi order dated 08.04.2024 for A.Y. 2015-16. The Assessing Officer had completed assessment u/s.144 of the Income-tax Act, 1961, taxing 50% of interest received on enhanced compensation of Rs. 78,26,144/- under sections 56(2)(viii) r.w.s.57(iv) and 145A(b). The appellant contended that the interest was compensation on acquisition of agricultural land and not taxable. However, the CIT(A)/NFAC upheld the AO's order relying on the cited provisions. The Tribunal found no reason to interfere, holding that "the action of the AO in bringing to tax the interest received on enhanced compensation is in conformity with the provisions of section 57(iv) r.w.s.56(2)(viii) r.w.s.145A(b) of the Act." The appeal was accordingly dismissed.