1997 (11) TMI 85

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..... ollowing question of law is referred under section 256(1) of the Income-tax Act, 1961, for the opinion of this Court : "Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in holding that provisions of sections 54E(3) and 155(10B) of the Income-tax Act, 1961, were applicable in the case of the assessee for the assessment year 1975-76 whereas t .....

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..... nal assessment under section 154 read with section 155(7A) to tax the enhanced compensation received by the assessee on July 11, 1979. The assessee contended that if the assessment is to be rectified under section 155(7A) to rope in the income received by way of additional compensation, the Income-tax Officer should have gone a step further and rectified the assessment under section 155(10B) and g .....

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..... which is one of the specified assets. The Appellate Tribunal affirmed the decision of the Commissioner (Appeals). Hence, the Revenue sought the present reference under section 256(1). In our view, as rightly observed by the Tribunal, the rectification of assessment in the light of subsequent event of accrual of additional capital gain by way of enhanced compensation cannot be a one-sided measure .....

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..... received should relate to a future acquisition. We are fortified in our view by the decision of this court in S. Gopal Reddy v. CIT [1990] 181 ITR 378. In that case, the Division Bench was concerned with the interpretation of section 54E(1) and the second proviso added to the said sub-section with effect from April 1, 1984. The learned judges having referred to the factors peculiar to compulsory .....

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..... 54E(3) is clear and categorical. Sub-section (10B) of section 155 has been introduced to effectuate the relief granted by section 54E(3) as a part of fiscal policy. We have, therefore, no hesitation in answering the question affirmatively, that is to say, in favour of the assessee and against the Revenue. Accordingly, the reference case is disposed of. No costs.    
Case laws, De .....

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