TMI Blog2018 (7) TMI 1163X X X X Extracts X X X X X X X X Extracts X X X X ..... the limited and restricted powers of rectification u/s 154 or u/s 254 as the case may be, it cannot be said that any mistake apparent on record had occurred in the order of the Tribunal. In view of the above discussion, these appeals of the assessee are hereby allowed. - ITA Nos. 1413 to 1415/CHD/2016, ITA Nos. 1416 to 1418/CHD/2016, ITA Nos. 1419 to 1421/CHD/2016, ITA Nos. 1422 to 1424/CHD/2016, ITA Nos. 1432 to 1434/CHD/2016, ITA Nos. 1435 to 1437/CHD/2016 And ITA Nos. 1429 to 1431/CHD/2016 - - - Dated:- 9-7-2018 - SHRI SANJAY GARG, JUDICIAL MEMBER AND Dr. B.R.R. KUMAR, ACCOUNTANT MEMBER ITA Nos. 77 to 79/CHD/2017 And ITA Nos. 80 to 82/CHD/2017 For The Appellant : Shri Gaurav Mittal, Adv. For The Department : Smt.Lagan Preet Sandhu, Sr. DR ORDER Per Bench : This bunch of appeals have been preferred by different assessees for different assessment years. Whereas the respective appeals of S/Shri Satbir and Ved Pal for three years each are directed against the separate orders of CIT (Appeals), Jind dated 02.11.2016, the respective appeals of Shri Sheo Chand, Shri Karambir, Shri Krishan Kumar, HUF and Shri Ravi Dutt for three years each are di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... art of the compensation liable to be taxed under section 45(5) of the income Tax Act and the transferred land being rural agricultural land exempt from capital Gains tax u/s 10(37) of the Income Tax Act, 1961. Subsequently, from the perusal of the computation of income attached with the return of income filed by the assessee for assessment year 2009-10, the Assessing Officer observed that w.e.f. assessment year 2010-11 the interest received on enhanced compensation was taxable in the year of receipt as per the provisions of section 145A(b) of the Act. However, prior to assessment year 2010-11 interest received on compensation/enhanced compensation was taxable on proportionate basis for the each year in view of the decision of the Hon'ble Supreme Court rendered in the case of Rama Bai Vs. CIT dated 8.11.1989 reported in 181 ITR 400 (SC). The Assessing Officer, therefore, reopened the assessment proceedings of the assessees and applied the ratio of the decision of the Hon'ble Supreme Court in the case of Rama Bai (supra) and held that the interest received by the assessees on the enhanced compensation was to be proportionately allocated to different assessment years as hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the decision dated 2.2.2016of the Hon'ble Punjab Haryana High Court in the case of Jagmal Another Vs. state of Haryana Another in RA-CR NO.46 Cll of 2014 in CR No.7740 of 2012, whereby the Hon'ble High Court had recalled its earlier order and held that the interest of the additional award was taxable under u/s 56(2)(viii) r.w.s.57(iv) of the Act. 9. The Ld.CIT(Appeals) considering the aforesaid decisions and also the decision of the Hon'ble Punjab Haryana High Court in the case of Sunder Lal Another Vs. Union of India Others in CWP No.20014 of 2015, order dated 21.9.2015 and also in the case of CIT Vs. Bir Singh (HUF) in ITA No.209 of 2004, etc. held that in the light of the above decisions, the mistake apparent on record had occurred in his order while allowing the appeal of the assessees while relying upon the decision of the Hon'ble Supreme Court in the case of Ghanshyam (HUF) (supra). He, therefore, vide the impugned order passed u/s 154 of the Act held that the interest received by the assessee on enhanced compensation on account of acquisition of land was taxable as income from other sources . He, therefore, confirmed the additions made by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tionment for each year from the date of acquisition of lands till the receipt of the compensation in the light of the decision of the Hon'ble Supreme Court in the case of Rama Bai (supra); the second issue involved is as to whether the interest awarded u/s 28 of the Land Acquisition Act on enhanced compensation is to be treated as part of the enhanced compensation and will not be taxable separately as interest income under the Head income from other sources ? 14. We find that both these issues are covered by the aforesaid decision of the Hon'ble Supreme Court in the case of Ghanshyam (HUF) (supra) holding the same to be in the nature of compensation itself. The Court also dealt with the other aspect namely, the year of tax and answered this question by holding that it has to be tested on receipt basis, which means it would be taxed in the year in which it is received. The said findings given in the case of Ghanshyam (HUF) (supra) have been reiterated by the Hon'ble Supreme Court in the case of Govindbhai Mamaiya (supra) observing as under: In so far as the second question is concerned, that is also covered by another judgment of this Court in Commissioner of In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 28, which is on enhanced compensation, is treated as a accretion to the value and therefore, part of the enhanced compensation or consideration making it exigible to tax. After holding that interest on enhanced compensation under Section 28 of 1894 Act is taxable, the Court dealt with the other aspect namely, the year of tax and answered this question by holding that it has to be tested on receipt basis, which means it would be taxed in the year in which it is received. It would mean that converse position i.e. spread over of this interest on accrual basis is not permissible. 15. The Ld. counsel for assessee has further brought our attention the latest decision of the Hon'ble Supreme Court in the case of CIT Vs. Chet Ram (HUF) dated 12.9.2017 in Civil Appeal No.13053/2017 wherein also the Hon'ble Supreme Court has again reiterated the proposition laid down in the case of Ghanshyam (HUF) (supra), which we find has been further reiterated in the case of Union of India vs. Hari Singh others in Civil Appeal No. 1504 of 2017 dated 15.9.2017, as under: (2) While determining as to whether the compensation paid was for agricultural land or not, the Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vations: 4.3 The issue whether the interest paid under the provisions of section 28 of LA Act is part of the enhanced compensation or is it taxable as interest income has been a debatable issue and has been considered by number of judicial authorities. 18. A perusal of the above reveals that the Ld.CIT(Appeals) himself has held that the issue under consideration was a debatable issue at time of reopening of assessment and the issue was squarely covered by the decision of the Hon'ble Supreme Court in the case of Ghanshyam (HUF) (supra) which was relied upon by the assessee and has also discussed by the Assessing Officer in the impugned order passed u/s 147 of the Act. The principle laid down by the Hon'ble Supreme Court in the case of Ghanshyam (HUF) (supra) since have been reiterated by the Hon'ble Supreme Court in the case of Govindbhai Mamaiya (supra) and further in the case of Chet Ram (HUF) (supra) and in the case of Hari Sing (supra),as discussed above. 19. In view of the above discussion, the impugned additions are not sustainable in the light of above referred to decisions of the Hon ble Supreme Court and they are accordingly ordered to be deleted. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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