2011 (8) TMI 10

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....PER J.P. DEVADHAR, J. 1. The petitioners are aggrieved by the action on the part of the respondents in deducting tax at source while paying the amount of compensation on acquisition of the land belonging to the petitioners. The petitioners have also challenged the constitutional validity of Section 194LA of the Income Tax Act, 1961.   2. As regards the deduction of tax at source is conc....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... day, Section 194LA was on the statute book and, therefore, tax had to be deducted while making the payment of compensation. For the delay in paying the compensation, the petitioners have been paid interest and, therefore, the fact that the compensation has been paid belatedly, cannot be a ground to hold that the compensation with interest has to be paid without deducting tax at source.   ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....tutional.   4. We see no merit in the above contention. The Apex Court in the case of Associated Cement Company Limited V/s. Commissioner of Income Tax reported in 201 ITR 435 (SC) was called upon to consider similar provisions contained in Section 194C of the Act under which a person responsible to make payment to a contractor is required to deduct tax at source before making the payment.....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....etermine what part of the amount paid by him to the contractor constitutes the income of the latter. It is not also possible to think that Parliament could have intended to cast such impossible burden upon the payer nor could it be attributed with the intention of enacting such an impractical and unworkable provision. Hence, on the express language employed in the subsection, it is impossible to h....