TMI Blog1971 (12) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... t date till September 6, 1962, rightly - - - - - Dated:- 9-12-1971 - Judge(s) : P. GOVINDAN NAIR., T. S. KRISHNAMURTHY IYER. JUDGMENT The judgment of the court was delivered by GOVINDAN NAIR J.-This is a reference under section 256(1) of the Income-tax Act, 1961, by the Income-tax Appellate Tribunal, Cochin Bench, at the instance of the revenue and the question referred is : "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in holding that the amount received by the assessee by way of interest till the date of the award is capital receipt ? " The question arose with reference to the assessment of the Periyar Pareekanni Rubbers Ltd. for the year 1963-64. During the year that end ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e accordingly direct the deletion of the proportionate interest from November 29, 1961, till August 31, 1962, from the income of the assessee. " Counsel on behalf of the revenue has challenged this deduction allowed by the Tribunal. He submitted that there is no distinction between interest that is payable under section 28 or 34 of the Land Acquisition Act, 1894, and interest that had been paid in this case. He went to the extent of submitting that even if this is not so, it must be taken that the possession assumed by the Government was also under the provisions of the Act and the interest payable under sections 28 and 34 of the Land Acquisition Act, 1894, are awardable in relation to possession taken outside the Act. A distinction has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ature of the possession changed from that date and, we think, the Tribunal refused to allow deduction of interest payable from that date till September 6, 1962, rightly. But, as regards the payment of interest for the anterior period, the view taken is in consonance with the Supreme Court decision. The principle is that stated by the Privy Council in Vallabhdas Naranji v. Development Officer, Bandra and in Inglewood Pulp and Paper Co. Ltd. v. New Brunswick Electric Power Commission. The latter decision has been approved by the Supreme Court in Dr. Shamlal Narula v. Commissioner of Income-tax. We answer the question referred to us in the affirmative, that is, against the department and in favour of the assessee. We make no order as to cost ..... X X X X Extracts X X X X X X X X Extracts X X X X
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