TaxTMI 
TaxTMI 
2019 (1) TMI 1544
X X X X Extracts X X X X
X X X X Extracts X X X X
.... taken up together for hearing and are being disposed of by way of this common order. 3. We shall be dealing with the facts in the case of appeal of the assessee in ITA 597/CHD/2018 and our decision rendered in this appeal would apply mutatis-mutandis to all the other appeals. 4. The assessee has raised the following grounds of appeal in ITA 597/CHD/2018 : 1.1 That order dated 26.2.2018 u/s 263(1) of the Act by learned Principal Commissioner of Income Tax, Hisar has been made without satisfying the statutory preconditions contained in the Act and is therefore without jurisdiction and thus, deserves to be quashed as such. 1.1 That the learned Pr. Commissioner of Income Tax has failed to appreciate that once the learned Assessing Officer on examination of the facts on record and after making all possible enquiries had accepted claim of the appellant then such an order of assessment could not be regarded as erroneous in as much as prejudicial to the interest of revenue merely because the learned Principal Commissioner of Income Tax had a different opinion and that too, without having established in any manner that, view adopted by the learned Assessing Officer was an impossible....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he case are that the ld. Pr. CIT noted from the assessment record of the assessee that during the impugned year, certain land belonging to it was acquired by the Land Acquisition Officer, HUDA and compensation, enhanced compensation and interest thereon were awarded in lieu thereof by HUDA/various Courts. As a result, the assessee received interest on enhanced compensation amounting to Rs. 27,23,225/- u/s 28 of the Land Acquisition Act during the year under consideration and claimed whole of the interest exempt as capital gains earned from sale of rural agricultural land, in view of the judgement of the Hon'ble Apex Court delivered in the case of Ghanshyam, HUF reported at 315 ITR 1 (2009). The Pr. CIT noted that the Hon'ble Punjab & Haryana High Court in its judgement in the case of Manjit Singh Vs Union of India & others in CWP No. 15006 of 2013 had observed that the benefit of two Judges Bench decision of the Apex Court in the case of Ghanshyam, HUF could not be derived by the assessee and held that the said interest awarded by the Court on enhanced compensation u/s 28 of the Land Acquisition Act fell for taxation u/s 56 of the Income Tax Act,1961 as 'income from oth....
X X X X Extracts X X X X
X X X X Extracts X X X X
....direction to add 50% of interest income to the assessed income of the assessee. 6. During the course of hearing before us, ld. counsel for the assessee pointed out that subsequent to the decision passed by the Hon'ble jurisdictional High Court in the case of Naresh Jain (supra),which was heavily relied upon by the ld. Pr. CIT in his order for stating that the proposition laid down by the Apex Court in the case of Ghanshyam, HUF stood overruled, and that interest u/s 28 was liable to tax as 'income from other sources', the Hon'ble Apex Court had categorically reiterated its decision rendered in the case of Ghanshyam, HUF in the case of Union of India & Ors. Vs Hari Singh & Ors. in CA No. 15041/2017 dated 15.09.2017. It was pointed out that the decision of the jurisdictional High Court in the case of Naresh Jain was dated 12.07.2017, while the Apex Court had reiterated the decision rendered in the case of Ghanshyam, HUF subsequently in September,2017 and therefore, the proposition laid down by the Apex Court was the law of the land following which interest u/s 28 of the LAA,1894,was in the nature of enhanced compensation and not in the nature of interest and therefor....
X X X X Extracts X X X X
X X X X Extracts X X X X
....down by it in Ghanshyam, HUF(supra) vis a vis interest received u/s 28 of the LAA,1894 be kept in mind to ascertain whether the interest received amounts to compensation or not. The relevant findings of the Hon'ble Supreme Court in this regard are as under : We find force in the submission of the learned Additional Solicitor General insofar as the challenge to the direction given to the Land Acquisition Collector to determine as to whether the land in question is agricultural land or not. Since the Land Acquisition Collector had . already deducted tax at source and deposited with the Income Tax Department, in such circumstances, better course of action, which is in consonance with the provisions of Income Tax Act, is for the respondents to approach the concerned Assessing Officer(s) and to raise the issue that no tax is payable on the compensation/enhanced compensation which is received by them as their land was agricultural land. Once such an issue is raised before the Assessing Officer(s), it is for the Assessing Officer(s) to examine the facts of each case and then apply the law as contained in the Income Tax Act to determine the aforesaid question. Insofar as these cases ....