TDS on land-acquisition compensation must follow a prior land classification and tax-liability determination before deduction.

Tax deducted at source could not be withheld from compensation for acquisition of land unless the authority first determined whether the acquired land was agricultural and whether tax was actually deductible. The document stresses that the same issue had already been decided earlier and that the earlier ruling had to be followed unless set aside. It also notes that continued non-compliance with that ruling risked avoidable litigation and possible contempt consequences. The petitions were disposed of in line with the earlier ruling, and the authorities were directed to issue immediate instructions to ensure compliance and stop unlawful deduction and repetitive disputes.

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Issues: Whether tax deducted at source could be withheld from compensation payable for acquisition of agricultural land without first determining whether the land was agricultural and whether the deduction already made had to be dealt with in terms of the earlier ruling.

Analysis: The petitions raised the same question already considered in the earlier decision. It was noted that deduction of tax at source from compensation for acquired land could not be made mechanically without first deciding whether the acquired land was agricultural land and whether tax was in fact liable to be deducted. The Court also noticed continued non-compliance with the earlier ruling and observed that once a judgment is rendered, it must be followed unless set aside, failing which avoidable litigation and possible contempt consequences may arise.

Conclusion: The petitions were disposed of in terms of the earlier ruling, and the authorities were directed to issue immediate instructions ensuring compliance so that unlawful deduction and repetitive litigation would cease.

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