TaxTMI 
TaxTMI 
2006 (9) TMI 91
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....nment, the amounts received as per interim conditional orders of the Court when the appeal by the State objecting to the enhancement of compensation was pending were liable to tax ? 2. Whether on the facts and in the circumstances of the case, Section 45(5)(c) of the Income-tax Act inserted by the Finance Act, 2003 w.e.f. April 1, 2004 is applicable for the assessment years 1997-98 and 1998-99 ? 3. Whether on the facts and in the circumstances of the case the Income-tax Appellate Tribunal was right in not referring to and not following the decision of this Hon'ble Court in the case of CWT/CIT v. T. Girija Ammal [2006] 282 ITR 614 cited and relied on before the Appellate Tribunal ?" 2. The assessment years with which we are concerned are ....
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....b) of the Income-tax Act. 5. The Commissioner of Income-tax (Appeals) dismissed the appeal filed by the assessees. On further appeal, the Appellate Tribunal upheld the order of the Commissioner of Income-tax (Appeals). Hence, the present appeal. 6. The primary issue that arises in all the appeals is as to the taxability of compensation received pending appeals before the Calcutta High Court. It is not in dispute that pending the appeals filed against the award of compensation, the assessees withdrew the award amounts as per interim orders of the Calcutta High Court, which were brought to tax. 7. Learned counsel for the appellants submitted that the assessees received the amounts pending appeals which reached its finality subsequen....
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.... of India shall be chargeable as income under the head "Capital gains" of the previous year in which such compensation or part thereof, or such consideration or part thereof, was first received; and (b) the amount by which the compensation or consideration is enhanced or further enhanced by the court, tribunal or other authority shall be deemed to be income chargeable under the head "Capital gains" of the previous year in which such amount is received by the assessee. (c) where in the assessment for any year, the capital gain arising from the transfer of a capital asset is computed by taking the compensation or consideration referred to in clause (a) or, as the case may be, enhanced compensation or consideration referred to in claus....
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.... received for the transfer of the land until it is finally determined by the High Court or Supreme Court. If the appeal of the State is allowed, the assessee is bound to refund the amount and hence, the same cannot be assessed before reaching finality. The right to receive additional amount awarded by the court as part of the compensation, was only an inchoate right during the pendency of the matter before higher judicial forums. In such circumstances, the disputed compensation has to be assessed only when it is finally determined by the higher Courts." 12. We are of the view that the amounts received by the assessees cannot be assessed before the appeals pending before the Calcutta High Court reached their finality, which are said to hav....