Compensation on compulsory land acquisition remanded for fresh tax exemption review under CBDT circular and RFCTLARR Act.

Compensation for compulsory acquisition of land and building was remitted for fresh examination because CBDT Circular No. 36 of 2016 and section 96 of the RFCTLARR Act had not been placed before or considered by the lower authorities. The Tribunal held that the exemption claim needed reconsideration on the basis of the relevant circular and statutory provisions, and directed the Assessing Officer to adjudicate the matter de novo to secure substantial justice and avoid multiplicity of proceedings.

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Issues: Whether the compensation received on compulsory acquisition of land and building required fresh consideration in light of CBDT Circular No. 36 of 2016 and section 96 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, and whether the matter should be restored for de novo assessment.

Analysis: The appeal was filed with delay, which was condoned. On merits, the Tribunal noted that the circulars relied upon before it had not been produced before the lower authorities and, therefore, were not considered by them. Since the claim of exemption depended upon the applicability of the CBDT circular and section 96 of the RFCTLARR Act, the Tribunal held that the matter required fresh examination by the Assessing Officer. To render substantial justice and avoid multiplicity of proceedings, the Tribunal directed the Assessing Officer to consider the circulars and other relevant legal provisions afresh.

Conclusion: The matter was restored to the Assessing Officer for de novo consideration of the exemption claim and related legal issues.

Final Conclusion: The assessee obtained a remand for fresh adjudication of the taxability of the compensation, and the appeal succeeded only for statistical purposes.

Ratio Decidendi: Where material legal circulars and statutory exemption provisions were not considered by the lower authorities, the appropriate course is to restore the matter for fresh decision on merits.

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