Taxation of land acquisition interest upheld year-wise; revisional power cannot substitute one possible view for another.

Interest on compensation arising from land acquisition was required to be taxed in the assessment years in which it accrued from year to year, rather than wholly in the year of receipt. The Tribunal followed its earlier ruling on the same issue and accepted the assessee's year-wise offer of the interest as correct. It also held that revisional jurisdiction could not be exercised merely to replace one possible view with another where the assessment was not shown to be erroneous and prejudicial to the revenue. On that basis, the order under section 263 was held unsustainable.

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Issues: Whether interest on compensation arising from land acquisition was taxable in the year of receipt or was liable to be spread over the relevant years of accrual, and whether the revisional order under section 263 was sustainable.

Analysis: The Tribunal held that interest on compensation had to be assessed in the relevant assessment years in which it accrued from year to year, and not brought to tax entirely in the year of receipt. It relied on its earlier decision on the same point and also on the principle that where two views are possible, the Commissioner could not invoke revisional jurisdiction to substitute one possible view for another. On that basis, the assessee had correctly offered the interest year-wise, and the assessment could not be treated as erroneous to the revenue's prejudice.

Conclusion: The revisional order was not sustainable and the assessee's method of spreading the interest over the relevant years was upheld.

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