TaxTMI Login
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →Just a moment...
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
Issues: Whether interest on delayed payment of compensation received under section 34 of the Land Acquisition Act, 1894 was taxable in the assessment year in question where the assessee followed the cash system of accountancy.
Analysis: The substituted section 145 of the Income-tax Act, 1961 permits computation of income either on cash basis or on mercantile basis, as regularly employed by the assessee. Under the cash system, income is taxed on actual receipt in the relevant year. The earlier decisions dealing with enhanced compensation and interest on accrual basis were distinguished as cases arising under mercantile accounting, where income is taxed on accrual and the right to receive must have crystallized. In the present case, the assessee had received the interest during the relevant year and, on a cash basis, the receipt constituted taxable income notwithstanding the dispute regarding compensation.
Conclusion: The interest on delayed payment of compensation was taxable in the assessment year 2002-03, and the question was answered in favour of the Revenue and against the assessee.
Final Conclusion: The appeal succeeded and the Tribunal's order was set aside.
Ratio Decidendi: Under the cash system of accounting, income is taxable on actual receipt in the relevant year, and interest received on delayed compensation is assessable in that year even if the underlying compensation dispute has not finally been settled.
TaxTMI 
TaxTMI 
