TMI Blog2019 (1) TMI 1544X X X X Extracts X X X X X X X X Extracts X X X X ..... s therefore set aside. - Decided in favour of assessee. - ITA No. 597/CHD/2018, ITA No. 598/CHD/2018, ITA No. 599/CHD/2018, ITA No. 600/CHD/2018 And ITA No. 602/CHD/2018 - - - Dated:- 11-1-2019 - SH. SANJAY GARG, JUDICIAL MEMBER AND SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER For The Assessee : Shri Tej Mohan Singh For The Revenue : Dr. Gulshan Raj, CIT-DR Order PER ANNAPURNA GUPTA, A.M. All the above appeals have been filed by different assessees against separate orders passed by the Principal Commissioner of Income Tax, Hisar [in short referred to as Pr.CIT] all dated 26.02.2018 u/s 263 of the Income Tax Act, 1961 ( hereinafter referred to as 'the Act') and all relating to assessment year 2013-14. 2. The order passed u/s 263 of the Act in all the above cases, it was common ground, was on account of identical issue relating to taxability of interest received u/s 28 of the Land Acquisition Act,(in short referred to as LAA) 1894. Since common issue was involved in all the above appeals, they were taken up together for hearing and are being disposed of by way of this common order. 3. We shall be dealing with the facts in the case of app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essing officer to add the interest income of ₹ 1361614/- representing 50% of the enhanced compensation of ₹ 27232257- eligible for exemption u/s 10(37) of the Act. 3.1 That while making the aforesaid addition the learned Principal Commissioner of Income Tax has erroneously relied on the judgment of Hon'ble Punjab and Haryana High Court in the case of Manjit Singh v. UOI CWP No. 15506/2013 dated 14.1.2014 and overlooking the following judgments of Apex Court: i) 315 ITR 1 (SC) CIT vs. Ghanshyam (HUF) (dated 16.7.2009) ii) 367 ITR 4 98(SC) CIT vs. Govindbhai Mamaiya (dated 4.9.2014)) iii) C.A. No, 13053/2017 CIT vs. Chet Ram (HUF) (dated 12.9.2017) iv) C.A. No. 15041/2017 Union of India and ORS vs. Hari Singh and ORS v) C.A. No. 18475/2017 Income Tax Officer TDS-2 Rajkot vs. Muktanandgiri Maheshgiri 3.2 That the learned Principal Commissioner of Income Tax has further erred both in law and on fact in invoking section 56(2)(vii) read with section 57(iv) of the Act to make the impugned addition. 5. Briefly stated the facts relating to the case are that the ld. Pr. CIT noted from the assessment record of the assessee that du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case of Manjit Singh (supra) while holding that the decision of the Apex Court in the case of Ghanshyam, HUF was not good law and hence would not apply. The ld. Pr. CIT further held that the Hon'ble jurisdictional High Court in another case i.e. Naresh Kumar Jain Ors. Vs State of Haryana Ors. in CWP 14728 of 2017 dated 12.07.2017 had again held that no benefit can be derived by assessees from the decision of the Apex Court in the case of Ghanshyam, HUF. Considering the same, the ld. Pr. CIT held that the assessment order passed by the AO u/s 143(3) of the Act, having failed to add 50% of the interest income as per the provisions of Section 56(2)(viii), 57(iv) and 145A(b) of the Act under the head 'income from other sources' ,and having not properly examined the facts of the case and accepted the version of the assessee without due examination of the issue of interest on enhanced compensation, was erroneous in so far as it was prejudicial to the interests of the Revenue. He, therefore, set aside the order passed by the AO restoring it to the AO for making fresh assessment with the direction to add 50% of interest income to the assessed income of the assessee. 6. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the High Court. The issue before the High Court was that the assessees had received enhanced compensation on which tax had been deducted at source as per the provision of Section 194LA of the Act. The assessee had contended that no tax was deductible on the same as land was agricultural land and without examining these facts, taxes had been deducted at source. The Hon'ble High Court had directed refund of the taxes to the assessees and had directed the Land Acquisition Officer/Collector to examine whether their lands were agricultural or not and decide whether taxes were liable to be deducted therefrom as per the provisions of the Act. The Union of India had come in appeal before the Hon'ble Supreme Court against this order of the High Court stating that it was the Assessing Officer who was capable of determining the nature of land as being agricultural or not for the purposes of taxability under the Income Tax Act, 1961. The same was agreed to by the Hon'ble Apex Court and they had, therefore, directed the AO to examine this aspect and further categorically stated that the proposition laid down by it in Ghanshyam, HUF(supra) vis a vis interest received u/s 28 of the L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount of Tax Deducted at Source (TDS) to the Land Acquisition Collector is, accordingly, set aside. However, in those cases where the amount has already been refunded, no interference is called for and it will be for the Income Tax Department to proceed in accordance with the provisions of Income Tax Act. ( 4) Where such notices have not already been issued or assessments have not already been made, if such an action is taken within a period of two months from today, issue of limitation would not come in the way of the Income Tax Department. This order is passed having regard to the fact that the present proceedings were pending in this Court because of which it was not possible for the Income Tax Department to issue these notices earlier. 9. In view of the categorical affirmation of the proposition laid down by the apex court in the case of Ghanshyam HUF(supra) ,in its latest decision in the case of Hari singh (supra), we hold that there is no error in the order of the AO treating the interest received by them u/s 28 of the LAA,1894,as compensation following the proposition laid down by the apex court in Ghanshyam HUF(supra).The order passed by the Ld.Pr.CIT u/s 263 is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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