TaxTMI 
TaxTMI 
1996 (5) TMI 64
X X X X Extracts X X X X
X X X X Extracts X X X X
....The questions referred to us are quoted below : " (i) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the transfer took place on the date of taking possession by the Government even though initial compensation/advance had been determined and became payable in subsequent years ? (ii) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the land was legally transferred within the meaning of section 17 of the Land Acquisition Act, 1894, when the land was neither waste or arable ? (iii) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that capital gain was chargeable to tax in the year of tak....
X X X X Extracts X X X X
X X X X Extracts X X X X
....9, 1972, stating, inter alia, that the land in question was required by itself for its office premises and the residence of shareholders. On a consideration of the said petition, the Government by its Notification No. RLA-430/68/136 dated December 12, 1975, released 3 bighas, 3 kathas, and 5 chhataks of land and accordingly, the State Government acquired the remaining part of the land measuring 3 bighas, 1 katha, and 10 chhataks. The Collector did not make any award up to the end of 1973. However, an advance payment of Rs. 67,325 was made on July 5, 1978. Later on, the award was made on July 27, 1979, for an amount of Rs. 1,34,650.63 and after deducting the advance payment made on July 5, 1978, the balance amount of Rs. 67,325.63 was pai....
X X X X Extracts X X X X
X X X X Extracts X X X X
....er dated July 7, 1989, passed in Appeal No. 63-817 of 1987-88. Being aggrieved by the said order of July 7, 1989, passed by the Commissioner of Income-tax (Appeals), the assessee further preferred an appeal before the Income-tax Appellate Tribunal, Gauhati Bench, Gauhati. The learned Tribunal decided the appeal in favour of the Revenue by observing that the capital gains earned by the assessee in the previous year 1973 relevant to the assessment year 1974-75 arising out of compulsory acquisition of its land by the State Government was assessable during the accounting year relevant to the assessment year 1974-75. Sri B. R. Dey, learned counsel for the assessee, submits that the assessee's land (land so acquired) is situated in the hear....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... land under section 17 of the Land Acquisition Act. It would be apparent from a perusal of the decision of the Bombay High Court in the case of M. B. Karmarkar and D. L. Gokhale v. CIT [1984] 150 ITR 234 that the notifications which are rescinded cease to exist legally and the court only considered the relevant operative notifications under sections 4 and 6 of the Land Acquisition Act and, the court in that case further held that there would not be any passing of the property or legal vesting of the same in the Government even though the possession have been handed over to the Government earlier. It is also evident from the said decision of the Bombay High Court about the distinction between the provisions of law contemplated under secti....
X X X X Extracts X X X X
X X X X Extracts X X X X
....at the land so acquired is not waste or arable land and that it has challenged the acquisition proceedings under section 17 of the Land Acquisition Act in the court of law. The learned Tribunal also found that no suit number or date of filing of suit or other relevant material have been filed by the assessee-company. In our considered view, if possession of the land has been taken over and handed over in case of urgency, as required under section 17 of the Land Acquisition Act in respect of any waste or arable land, such land shall thereupon vest absolutely in the Government, even though the award has been made subsequently after the possession of the land is taken. It is also evident from the records that the Government took possession ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ce at the relevant time of the acquisition of the assessee's land. The new section 17(1) of the Land Acquisition Act is also quoted below for ready reference : "17. Special powers in case of urgency.--(1) In cases of urgency, whenever the appropriate Government so directs, the Collector, though no such award has been made, may, on the expiration of fifteen days from the publication of the notice mentioned in section 9, sub-section (1), take possession of any land needed for a public purpose. Such land shall thereupon vest absolutely in the Government, free from all encumbrances." Under the new section 17 of the Land Acquisition Act, the words "any waste" or "arable land" do not find its place as the same has been substituted by the wo....