TaxTMI 
TaxTMI 
2019 (4) TMI 263
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....e facts relating to the 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. 27,94,637/- 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 th....
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....titution Bench) which had held that interest u/s 28 was akin to interest u/s 34 and did not form part of the compensation but was taxable as revenue receipt. The ld. Pr. CIT held that these decisions had been followed by the jurisdictional High Court in the case of Manjit Singh (supra) while holding that the decision of the Apex Court in the case of Ghanshyam, HUF was not good law and hence would not apply. The ld. Pr. CIT further held that the Hon'ble jurisdictional High Court in another case i.e. Naresh Kumar Jain & Ors. Vs State of Haryana & Ors. in CWP 14728 of 2017 dated 12.07.2017 had again held that no benefit can be derived by assessees from the decision of the Apex Court in the case of Ghanshyam, HUF. Considering the same, the ....
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....rt 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 therefore, had been rightly not returned to tax by assessees. It was pointed out that in view of the same, there was no error in the order of the AO and the jurisdiction assumed by ld. Pr. CIT, therefore, was erroneous. Further, ld. counsel for the assessee contended that identical issue had been heard by the Co-ordinate Bench of the ITAT Chandigarh Benches in the group of cases in ITA 597 to 600 & 602/CHD/2018 on 15.10.2018. The ld.....
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....ourt in the case of Hari Singh and find that the Union of India had come before the Supreme Court against the decision of the High Court in writ petition filed by the asseseees before the High Court. The issue before the High Court was that the assessees had received enhanced compensation on which tax had been deducted at source as per the provision of Section 194LA of the Act. The assessee had contended that no tax was deductible on the same as land was agricultural land and without examining these facts, taxes had been deducted at source. The Hon'ble High Court had directed refund of the taxes to the assessees and had directed the Land Acquisition Officer/Collector to examine whether their lands were agricultural or not and decide whe....
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....and. 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 are concerned, we allow these appeals by setting aside the directions contained in paragraph 7 and substitute the same with the following directions: (1) The respondents shall file appropriate returns before the Assessing Officer(s) in respect of Assessment Years in question within a period of two months from today in case they feel that the compensation in respect of land belonging to them which had been acquired was agricultural land, and claim refund of the tax which was deducted at sourc....