TMI Blog2012 (7) TMI 756X X X X Extracts X X X X X X X X Extracts X X X X ..... asis - Income-tax Department shall while assessing the liability of tax of the individual assessee shall take into consideration the fact that the interest received is from the years 2001 to 2009 - WRIT PETITION NO. 2153 OF 2011(O) - - - Dated:- 28-2-2012 - N.K. MODY, J. A.S. Kutumbale and B.S. Gandhi for the Petitioner. Prahlad Sharma, Smt. Mamta Shandilya and Ms. Veena Mandlik for the Respondent. ORDER This order shall also govern disposal of W.P.Nos.2155/2011, 2183/2011, 2184/2011, 2186/2011, 2188/2011, 2189/2011 and 2190/2011 as the question involved in all the petitions is identical in nature. 1. Being aggrieved by the order dated 27.11.2010 passed by 9th Addl. District Judge, Ujjain in execution cases filed by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the enhanced consideration on account of compulsory acquisition under any law for the time being in force, of any immovable property (other than agricultural land), shall at the time of payment of such sum in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to ten per cent of such sum as income-tax thereon : Provided that no deduction shall be made under this Section where the amount of such payment or, as the case may be, the aggregate amount of such payments to a resident during the financial year does not exceed one hundred thousand rupees." 4. Learned counsel submits that since the property, which was acquired by respondents No. 2 and 3 at the instance of respondent No. l, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that petitions be allowed and impugned order be set aside. 5. Shri Prahlad Sharma, learned counsel appearing on behalf of respondent No. 1, submits that no illegality has been committed by the learned Court below in passing the impugned order. It is submitted that before learned Court below respondent No. 1 requested the petitioners to submit permanent account number (in short PAN), so that the amount can be paid to the petitioners, but in spite of request PAN was not submitted, therefore, respondent No. 1 deposited the amount with the Income-tax Department. Learned counsel, placed reliance on the departmental Circular dated 5.12.2008 of the Income-tax Act based on Supreme Court ruling according to which "Interest payment made under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regarded as revenue receipt exigible to tax, therefore, tax is to be deducted under Section 194A in respect of such interest income. Further reliance is placed on a decision in the matter of Bikram Singh v. Land Acquisition Collector [1996] 89 Taxman 119 (SC) wherein the Hon'ble Apex Court has held that interest is not included as out of compensation and also is not consideration for acquisition. It was further held that interest is given to the land owner for the deprivation of the use of the money representing the compensation for the land acquired. This interest under Section 34 of the Land Acquisition Act is thus paid for the delayed payment of the compensation amount and, therefore, a revenue receipt liable to tax under the Income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecause in the Income-tax Act for compensation, which is payable under the Motor Vehicles Act, the tax is exempted up to Rs. 50,000/-, but such type of provision is not available for the interest, which is being payable under the Land Acquisition Act. Reliance is also placed on a decision in the matter of Sant Ram v. Union of India [2010] 328 ITR 77 (Punj. Har.) wherein Division Bench of Punjab Haryana High Court after taking into consideration the law laid down by the Hon'ble Apex Court in the matter of Bikram Singh (supra) had held that interest paid on delayed payment for acquisition of agricultural land is recorded as revenue receipt exigible to Income-tax, hence tax is to be deducted under Section 194-A of Income-tax Act in re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'ble Apex Court in the matter of Bikram Singh ( supra ) this Court is of the view that interest received on delayed payment is a revenue receipt exigible to Income-tax. Since the amount has already been deposited by the respondent Ujjain Development. Authority and the deduction is in accordance with Section 194-A of the Act therefore, this Court finds that no illegality has been committed by the learned Court below in upholding the action taken by respondent Ujjain Development Authority in deducting the amount. However, since the award was passed on 7.9.2001 and the compensation was paid somewhere in the years 2009, therefore, the interest, which is paid is on account of delayed payment of compensation in the years 2001 to 2009, therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X
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