TMI Blog2014 (6) TMI 1000X X X X Extracts X X X X X X X X Extracts X X X X ..... revious year as the assessment year being 1.4.2004 to 31.3.2005. When once the assessee receives the income by way of interest, the liability to pay tax under the Act arises. As that income is received prior to 31.3.2004, it has to be declared for the year commencing from 1.4.2003 to 31.3.2004 and it has to be assessed during the period from 1 4.2004 to 31.3.2005. The date on which the order of the Tribunal is passed, though determined the rights of the parties, on that day, no income is received by the assessee. It is on receipt of the income, the liability to file return under the Act would arise. The law provides for a reference to the civil court if the compensation awarded by the land acquisition officer, in the opinion of the land ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9;), a return was filed on 4.2.2005 declaring an income of ₹ 45,000/- and agricultural income of ₹ 2,10,000/-. The Assessing Officer noted that the assessee had received interest of ₹ 87,81,443/- under Section 244A of the Act during the previous year relevant to the assessment year 2004-2005. The assessee had not included this income in the return of income. When this was pointed out, the assessee relied on a judgment of the Tribunal, where, it was held that interest under Section 244-A of the Act cannot be brought to tax till a finality is reached regarding the issue relating to the assessment of income. The Assessing Officer did not agree with the said stand. Therefore, he proceeded to include the amount of ₹ 87,81 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Section 244A(1) of the Act also contains quantification in certain circumstances and not the right of interest. Therefore, the Tribunal did not find any infirmity in the order passed by the Commissioner of Income Tax (Appeals) as well as the order passed by the Assessing Officer and accordingly, dismissed the appeal. Against the said order, the assessee is before this Court. 5. This appeal came to be admitted on 23.10.2010 to consider the following substantial question of law: Whether or not the authorities below were correct in holding that the interest received by the assessee on account ITAT order is liable to tax? 6. The learned counsel for the assessee assailing the impugned order, contended that the proceedings under wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ous decisions of this Court as well as the Apex Court. Therefore, she submits that seen from any angle, the impugned order needs to be interfered. 7. Per contra, the learned counsel for the revenue supporting the impugned order contended that in view of Section 4 of the Act, the interest income is liable to tax in the year in which it is received. There is no dispute that the tax is payable on the interest income accrued. Therefore, he contends that merely because an appeal is pending against the order, is not a justification for the assessee not to pay any tax when the assessee received the amount by way of interest. Therefore, he submits that no case for interference is made out. He also submitted that the judgments relied on by the le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to this Court. It is in this background, the Assessing Officer took exception to the assessee in not declaring the interest income of 87,81,443/-. The liability was denied by the assessee on the ground that the appeal is pending and the amount is not finally determined. 8. Section 244A of the Act provides, where refund of amount becomes due to the assessee under the Act, he shall, subject to the provisions of this section, be entitled to receive, in addition to the said amount, simple interest thereon calculated in the manner stipulated in the said Act. The said interest received by the assessee could be income in the hands of the assessee. Section 4 of the Act which is the charging section levies tax under the Act on such interest. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt paid by way of tax. It would not be a case of double payment. Under these circumstances, we do not find any error in the orders passed by the three authorities. Insofar as the decisions relied on by the assessee is concerned, they are all cases arising under the Land Acquisition Act, where, after acquisition of the land the land acquisition officer passed award making an offer of payment of compensation. The law provides for a reference to the civil court if the compensation awarded by the land acquisition officer, in the opinion of the land owner, is not sufficient and the reference court has jurisdiction to enhance the compensation and also to award interest on the said compensation. The said order is also subject to appeal and second ..... X X X X Extracts X X X X X X X X Extracts X X X X
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