TaxTMI 
TaxTMI 
2013 (12) TMI 138
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....t with a serious accident on 16.2.2013 and got a severe head injury which resulted into temporary memory loss. In this regard, affidavit of the assessee had also been filed. He further pointed out that assessee is a senior citizen and aged about 86 years and took time to recover from the illness and that is why appeal has been filed late. He made a prayer for condonation of delay. 4. On the other hand, the Ld. DR opposed the application. 5. After considering the rival submissions we are satisfied that the assessee has sufficient cause in filing the appeal late and therefore, the delay is condoned. 6. After hearing both the parties, we find that after examination of the assessment records, Ld. Commissioner was of the view that assessment order was erroneous and prejudicial to the interest of Revenue and, therefore, a show cause notice was issued. He further found that assessee had received enhanced compensation amounting to Rs. 3,52,67,644/- during financial year 2000-01 on acquisition of land and out of this a sum of Rs. 2,10,55,847/- was towards compensation and amount of Rs. 1,42,11,495/- was towards interest on accrual basis. This claim was disputed by the State Governm....
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....Ghanshyam ( HUF) 315 ITR 1 (SC) interest on enhanced compensation was also to be treated as part of the enhanced compensation. However, it is to be noted that decision in the case of CIT Vs Ghanshyam (HUF) (supra) arose out of the judgment of the Hon'ble Supreme Court in Civil Appeal No. 4403 of 2009 arising out of SLP (C ) No. 17643 of 2008 pertained to CIT Panchkula v Mohan Singh i.e. the assessee wherein it was decided that enhanced compensation and interest on enhanced compensation are not to be taxed in total income. The following details were also submitted through written submissions. "In case of assessee the original Award of compensation on compulsory acquisition of land of the assessee at Ramgarh is dated 17.06.1992 was acquired by way of notification dated 26.06.1989 under section 4 of the Land Acquisition Act, 1894 & possession of the agriculture land was taken on 17.06.1992. Whereas in the case of CIT, Panchkula Vs. Smt. Shankuntla Devi the land was acquired by way of notification dated 04.05.1995 under section 4 if the Land Acquisition Act, 1894. For the purpose of section 2(14)(iii)(b), Panchkula was mentioned only in the Notification No. 9447/F.No.154/3/87-ITA-1 ....
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..../ 147, the compensation received by the assessee was held to be on account of capital asset and assessee had not filed any appeal against that order; therefore, order passed on 7.10.2010 is erroneous and prejudicial to the interest of Revenue. In view of these discussions, ultimately it was held vide para 5.4 as under:- "5.4 In view of the discussion in the preceding paras, it is held that the assessment order dated 07.10.2010 is erroneous and prejudicial to interest of revenue and is also without jurisdiction. The assessment framed by the Assessing Officer vide order dated 07.10.2010 is therefore cancelled u/s 263(1) with the direction to the AO to give appeal effect to the decision of Hon'ble Supreme Court in assessee's own case (lead case Ghanshyam (HUF)(supra)." 9. Before us, Ld. Counsel for the assessee submitted that originally return was filed on 22.3.2002 declaring total income of Rs. 1,89,477/-. The assessee received enhanced compensation amounting to Rs. 3,52,67,314/- consisting of cost of land amounting to Rs. 2,10,55,847/- and interest amounting to Rs. 1,42,11,497/- after detailed discussions the Assessing Officer held compensation portion not taxable in view of d....
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....2010 in which reliance was placed on the decision of Hon'ble Punjab & Haryana High Court in the case of CIT Vs Prem Singh (supra) Singh that enhanced compensation is not taxable. The Ld. Counsel for the assessee submitted that since section 148 proceedings was not concluded and Assessing Officer directed the assessee to file information regarding finalization of the Court case, which was initiated through rectification application and therefore, the Assessing Officer passed an order u/s 143(3) read with section 147, therefore, it cannot be said that proceedings were not pending before him. Further, the order has been passed following the order of Hon'ble Punjab & Haryana High Court in the case of CIT v Prem Singh (supra). He also referred to the assessment order u/s 143(3) read with section 147 for assessment year 2007-08 wherein similar view has been taken which has also been relied in this assessment order. Therefore, the order cannot be called erroneous and prejudicial to the interest of Revenue. In any case, once an order has been passed following the decision of Hon'ble jurisdictional High Court then such order cannot be called erroneous and in this regard, he relied on the de....
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....ision has been further amended by Finance Act 2003 w.e.f. 1.4.2004. In the meantime, the Tribunal also noted that the decision of the Hon'ble Supreme Court in the case of CIT v Hindustan Housing and Land Development Trust Ltd. (supra) and ultimately set aside the issue to the file of Assessing Officer with a direction to examine the nature of dispute raised by the government in respect of compensation. The Revenue filed appeal against this order before the Hon'ble High Court which was dismissed vide order dated 16.5.2007, copy of which is available at pages 44 to 51 of the paper book. In the meantime, assessment proceedings were reopened u/s 147 while recording the following reasons on 26.3.2008. The reasons have been incorporated in the assessment order, copy of which is available at page 52 to 61 of the paper book, which reads as under;- "In this case the assessee filed return of income on 22.03.2002 and declaring taxable income of Rs. 1,89,475/-. Order under section 143(3) was passed in the case of the assessee on 27.11.2003 in which a total demand of Rs. 5268937/- was created. The main ground of addition was of Rs. 1,42,11,497.50 on account of interest on enhanced compensati....
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.... assessee will only be taxable when the dispute regarding the quantum of enhanced compensation is settled. In the light of the facts and unambiguous position of the law in this regard, the return filed by the assessee, in response to notice under section 148 of the Act is accepted for the time being. The assessee is directed to inform the AO as and when the dispute regarding the quantum of enhanced compensation is decided by the Addl Sessions Judge Panchkula." 12. From the above, it becomes clear that in the reopened proceedings though return of the assessee was accepted but the issue was kept open. In response to this assessment order, the assessee filed rectification application on 27.1.2009 (copy available at pages 62 to 65 of the paper book). Through this application, the assessee challenged the reopening of assessment because originall y assessment was completed u/s 143(3) and reopening was done after four years. Further challenge was made that enhanced compensation is not taxable because land was acquired prior to notification NO. 9447/ F. No. 164/3/87 dated 06.01.1994. 13. During this period the Hon'ble Punjab & Haryana High Court in the case of CIT Vs Prem Singh in....