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2010 (1) TMI 108 - HC - Income TaxDeduction of tax at Source under section 194LA – Compensation for Agricultural Land – The petitioners received compensation for acquisition of their agricultural land. While disbursing the compensation, the collector made deduction of tax at source and remitted the amount to the revenue. The petitioners raised a plea that this was permissible only in the case of non-agricultural land. In this case Karnataka High Court-allow the petition and direct the Income-tax Department to refund the amount to the Collector within one month from the date of receipt of a copy of this order. Thereafter, the Collector will deter mine whether compensation paid is for property other than agricultural land or otherwise and whether deduction of tax at source was permissible under any provision of law. Whether deduction is permissible or not will be decided by the Collector within two months from the date of receipt of a copy of this order. If deduction is found not permissible, the amount will be refunded to the petitioners not later than three months from receipt of a copy of this order. – Decision in favor of assessee – against the revenue.
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