TMI Blog2013 (11) TMI 1651X X X X Extracts X X X X X X X X Extracts X X X X ..... is agricultural land. - C.R. No. 2509 of 2012 (O&M) - - - Dated:- 29-11-2013 - MR. PARAMJEET SINGH J. For the Petitioner: .Mr. Rajesh Hooda, Advocate, for Mr. Kamal Sehgal, Advocate, For respondent:.Mr. Alok Jain, Advocate, CM No. 10645-CII of 2012 For the reasons indicated in the CM, the same is allowed. Delay of 75 days in filing the revision petition is condoned. CR No. 2509 of 2012 Instant revision petition has been filed under Section 115 of the Code of Civil Procedure for setting aside the order dated 27.09.2011 (Annexure P/4) passed by learned Additional District Judge, Jhajjar whereby direction has been issued to the petitioner to disburse the tax deducted at source (for short `TDS') to the decree-holders within one month. I have heard learned counsel for the parties and perused the record. Admittedly, the respondent No.1 is land owner. Compensation has been assessed as per the provisions of Land Acquisition Act, 1894 (hereinafter referred to as the Act ) and respondent No.1 was aggrieved against the TDS to be remitted by the Land Acquisition Collector to the Income Tax Department. The issue with regard to deducti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, at the time of the Collector's taking possession of the land, by reason of severing such land from his other land; fourthly, the damage (if any), sustained by the person interested, at the time of the Collector's taking possession of the land, by reason of the acquisition injuriously affecting, his other property, movable or immovable, in any other manner, or his earnings; fifthly, if, in consequence of the acquisition of the land by the Collector, the person interested in compelled to change his residence or place of business, the reasonable expenses (if any) incidental to such change; and sixthly, the damage (if any) bona fide resulting from diminution of the profits of the land between the time of the publication of the declaration under section 6 and the time of the Collector's taking possession of the land. (1A) In addition to the market value of the land, as above provided, the Court shall in every case award an amount calculated at the rate of twelve per centum per annum on such market value for the period commencing on and from the date of the publication of the notification under section 4, sub-section (1), in respect of such lan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommissioner of Income Tax, Faridabad vs. Ghanshyam (2009) 8 SCC 412 in a different context however. In that case, Hon'ble Supreme Court has decided the question whether the amount of compensation and interest under Land Acquisition Act is taxable in year of receipt. While dealing with this issue, Hon'ble Supreme Court considered the nature of amount awarded under various provisions of Land Acquisition Act to determine its taxability and observed as under:- 49. As discussed hereinabove, Section 23(1A) provides for additional amount. It takes care of increase in the value at the rate of 12% per annum. Similarly, under Section 23(2) of the 1894 Act there is a provision for solatium which also represents part of enhanced compensation. Similarly, Section 28 empowers the court in its discretion to award interest on the excess amount of compensation over and above what is awarded by the Collector. It includes additional amount under Section 23(1A) and solatium under Section 23(2) of the said Act. Section 28 of the 1894 Act applies only in respect of the excess amount determined by the court after reference under Section 18 of the 1894 Act. It depends upon the claim, unlike ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s payable. Section 28 empowers the Court to award interest on the excess amount of compensation awarded by it over the amount awarded by the Collector. The compensation awarded by the Court includes the additional compensation awarded under Section 23(1-A) and the solatium under Section 23(2) of the said Act. This award of interest is not mandatory but is left to the discretion of the Court. Section 28 is applicable only in respect of the excess amount which is determined by the Court after a reference under Section 18 of the 1894 Act. Section 28 does not apply to cases of undue delay in making award for compensation. See: Ram Chand and Ors. etc. v. Union of India and Ors. (1994) 1 SCC 44. In the case of Shree Vijay Cotton Oil Mills Ltd,. vs. State of Gujarat (1991) 1 SC 262, this Court has held that interest is different from compensation. To sum up interest is different from compensation. However, interest paid on the excess amount under Section 28 of the 1894 Act depends upon a claim by the person whose land is acquired whereas interest under Section 34 is for delay in making payment. This vital difference needs to be kept in mind in deciding this matter. Interest under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om the observations of the Supreme Court that interest under Section 28 is, unlike under Section 34 of the 1894 Act, an accretion in value and regarded as part of the compensation itself which is not the case of interest under Section 34. With a clear statement of law obtaining through the Supreme Court. I would have no difficulty in saying that any component of compensation that goes towards the discharge of liability under Section 28 must be taken as part of the compensation to which Section 194 LA shall apply and that compensation being the value of agricultural land, then the exclusion as provided under the Section shall also be attracted. In this case, compensation assessed and the interest calculated are for acquiring agricultural land and the amount deposited represented the liability under Section 28. I have no doubt in my mind that there was no requirement for collecting TDS for this amount. I clarify that in terms of the judgment of the Supreme Court any liability which goes towards interest calculated under Section 34 would not obtain the benefit and if there is any deduction for TDS for such a component of interest, it shall be perfectly justified. Perusal of rel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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