Land acquisition compensation under section 23(1A) is additional compensation, not taxable interest, where delayed-payment interest is separately provided.

The 12% amount under section 23(1A) of the Land Acquisition Act, 1894 was treated as part of compensation for compulsory acquisition, not as interest. The provision uses the term "amount" and operates within the compensation scheme, while interest for delayed payment is separately dealt with under sections 28 and 34. On that basis, the payment was additional compensation and not taxable as income from other sources, so the addition was rightly deleted.

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Issues: Whether the amount calculated at 12% per annum under section 23(1A) of the Land Acquisition Act, 1894 formed part of the compensation for compulsory acquisition of land or constituted interest taxable as income from other sources.

Analysis: Section 23(1A) uses the expression "amount" and not "interest". Read with section 23(2), the provision is part of the scheme for determining compensation on compulsory acquisition. Interest payable for delayed payment is separately provided under sections 28 and 34 of the Land Acquisition Act, 1894. The amount awarded in the present case was not interest under either of those provisions. The jurisdictional High Court had also treated the 12% payment under section 23(1A) as additional compensation.

Conclusion: The amount of Rs. 6,92,073 was part of the compensation and was not taxable as income from other sources.

Final Conclusion: The addition was rightly deleted and the revenue's appeal failed.

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