1990 (4) TMI 1

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.... of law has been referred by the Tribunal to this court under section 256(1) of the Income tax Act, 1961 (" the Act ") : " Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the interest of Rs. 21,295 awarded by the High Court in the appeal preferred by the assessee for enhanced compensation on the requisition of his house property by t....

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....ard both the assessee and the Land Acquisition Collector preferred appeals to the Calcutta High Court. The High Court fixed the monthly compensation at Rs. 1,600 and further ordered that interest at the rate of six per cent. shall be payable on the enhanced amount of compensation from the date of possession till the date of payment. The interest amount came to Rs. 21,295. The Income-tax Officer tr....

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....he Tribunal overlooked the fact that this was not a case of acquisition of land. Any amount awarded as compensation for compulsory acquisition of land will have to be treated as capital receipt. There are cases where it was held that for delayed payment of compensation, if any sum of money is paid by way of interest, such payment may be of capital nature. But this is a case of requisition of prope....