1995 (6) TMI 15

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....eference has come to this court raising the following questions : " 1. Whether, on the facts and circumstances of the case, the Tribunal was justified in law in holding that the pre-award interest of Rs. 34,677 on arbitration award received by the assessee was not taxable under the Income-tax Act, 1961 ? 2. Whether, on the facts and circumstances of the case, and when the principal award mon....

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....nses incidental to the arbitration proceedings. The pre-award interest too was exigible to tax. On appeal, the Commissioner of Income-tax (Appeals) held that the pre-award interest of Rs. 34,677 was not taxable in view of the decision in Govinda Choudhury and Sons v. CIT [1977] 109 ITR 497 (Orissa). It is stated that the Department preferred an appeal before the Tribunal against the said order of ....

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....ward interest. The Assessing Officer taxed the entire amount received by the assessee under the award after allowing some deductions. The Tribunal held that the assessee's income should be determined at 12.5 per cent. of the award amount after excluding the interest component included therein. It also held that the pre-award interest should be totally excluded from the income of the assessee. On t....