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2017 (1) TMI 1380 - SUPREME COURT OF INDIA

2017 (1) TMI 1380 - SUPREME COURT OF INDIA - TMI - Reopening of assessment - Claim for exemption under Section 10(37) denied - acquisition of the land - stand taken by the Revenue that the amount of compensation/consideration received by the appellant against the aforesaid land was not the result of compulsory acquisition and on the contrary it was the voluntary sale made by the appellant to the Techno Park and, therefore, the provisions of Section 10(37) of Act were applicable - Held that:- .....

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ng to him to Techno Park. Merely because the compensation amount is agreed upon would not change the character of acquisition from that of compulsory acquisition to the voluntary sale. It may be mentioned that this is now the procedure which is laid down even under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 as per which the Collector can pass rehabilitation and resettlement award with the consent of the parties/land owners. None .....

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llant, therefore, only wanted to salvage the situation by receiving as much compensation as possible commensurate with the market value thereof and in the process avoid the litigation so that the appellant is able to receive the compensation well in time. If for this purpose the appellant entered into the negotiations, such negotiations would be confined to the quantum of compensation only and cannot change or alter the nature of acquisition which would remain compulsory. We, therefore, overrule .....

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ao, Adv. Ms. Niranjana Singh, Adv. Mr. Arijit Prasad, Adv. Mr. R.M. Bajaj, Adv. Mrs. Anil Katiyar,Adv. JUDGMENT A.K.SIKRI, J. Leave granted. Heard the matter finally at this stage with the consent of the parties as it was fixed for final disposal. The question of law that is raised in this appeal and squarely arises for consideration is the following: Whether, on the facts and circumstances of the case, the High Court was justified in denying the claim for exemption under Section 10(37) of the I .....

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ment of Techno Park'. For this purpose, Notification under Section 4(1) of the Land Acquisition Act, 1894 (hereinafter referred to as the 'LA Act') was issued on 01.10.2005. An opportunity was given to the appellant to file his objections, if any, under Section 5A of the LA Act. Record does not reveal as to whether such objections were filed or not. However admittedly, thereafter, declaration under Section 6 of the LA Act was issued on 02.09.2006 wherein the Government had declared t .....

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ately it was agreed by the Techno Park, for whom the property in question was acquired, to pay a sum of ₹ 38,42,489/-. After this amount was agreed upon between the parties, the appellant agreed to execute a sale deed of the property in question in favour of Techno Park. Such sale deed was executed on 08.05.2008 and duly registered with the Sub-Registrar, Kazhakkootam. While disbursing the aforesaid amount of sale consideration, the Techno Park deducted 10% of the amount of TDS and it was .....

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r the head Capital gains arising from the transfer of agricultural land, where- (i) such land is situate in any area referred to in item (a) or item (b) of sub-clause (iii) of clause (14) of section 2; (ii) such land, during the period of two years immediately preceding the date of transfer, was being used for agricultural purposes by such Hindu undivided family or individual or a parent of his; (iii ) such transfer is by way of compulsory acquisition under any law, or a transfer the considerati .....

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r of agricultural land by way of compulsory acquisition under any law, no capital gain tax is payable. It is clear from the above that the initial view of the Income Tax Department, while refunding the aforesaid TDS amount to the appellant, was that the land in question was compulsorily acquired under the LA Act and, therefore, capital gain tax was payable. The appellant filed income tax return for the Assessment Year 2009-10 and the income was also assessed accordingly. However, thereafter on 3 .....

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made by the appellant to the Techno Park and, therefore, the provisions of Section 10(37) of Act were applicable. The appellant objected to the re-opening of the said assessment by filing his reply dated 30.11.2012. However, respondent no. 2 namely, the Joint Commissioner, Income Tax Range-I, Kawadiar, Thiruvananthapuram, took the view that the case did not come under compulsory acquisition and directed the Assessing Officer to compute the income accordingly. This direction dated 11.03.2013 of r .....

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aid factual backdrop, this Court is to determine as to whether it can be treated that the land of the appellant was compulsorily acquired. From the facts mentioned above, it becomes apparent that the acquisition process was initiated by invoking the provisions of LA Act by the State Government. For this purpose, not only Notification under Section 4 was issued, it was followed by declaration under Section 6 and even Award under Section 9 of the LA Act. With the award the acquisition under the LA .....

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as proper or not. However, the matter thereafter is only for quantum of compensation which has nothing to do with the acquisition. It is clear from the above that insofar as acquisition is concerned, the appellant had succumbed to the action taken by the Government in this behalf. His only objection was to the market value of the land that was fixed as above. To reiterate his grievance, the appellant could have either taken the aforesaid adjudicatory route of seeking reference under Section 18 o .....

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y acquired as the entire procedure prescribed under the LA Act was followed. The settlement took place only qua the amount of the compensation which was to be received by the appellant for the land which had been acquired. It goes without saying that had steps not been taken by the Government under Sections 4 & 6 followed by award under Section 9 of the LA Act, the appellant would not have agreed to divest the land belonging to him to Techno Park. He was compelled to do so because of the com .....

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