TaxTMI 
TaxTMI 
2020 (5) TMI 465
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....xts.P7 and P8, assessment order and notice of demand issued by the Income Tax Department, respectively. 2. Succinctly, the facts which are necessary for adjudication of the controversy involved are that the petitioner is the absolute owner, title holder of a land to the extent of 7.33 cents with three shop rooms and a residential building in Sy. No.170/2 and 170/4 in Elamkulam Village, Kanayannoor Taluk, Ernakulam District, which is situated on the southern side of the Thammanam Pullepady Road. The market value of the land on announcement of Smart City Project, Metro Rail Project and Mono Rail Project, increased many fold. Out of the aforementioned land, about 1.32 Ares (3.26 cents) of land with a building of 1500 Sq. Ft. had been taken ....
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....ice under Section 143 (1) of the Income Tax Act, 1961. In the result thereof, the petitioner received a show cause notice. Petitioner was represented through an authorised representative and brought to the fact that the aforementioned compensation can be exempted under Section 96 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 as it would not fall within the mischief of Section 54F of the Income Tax Act, 1961. In support of the aforementioned contention, reliance has been laid to Circular No.36/2016 dated 25.08.2016 whereby the Central Board of Direct Taxes issued a clarification that if the land is nonagricultural, it would not be taxable as per the provisions of the Income-....
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....bilitation and Resettlement Act, 2013, do not leave any doubt in the mind that if the land is either acquired or the result of an agreement, it could not fall within the mischief of Income Tax Act, in other words, exemption is liable to be granted. It is in this background of the matter and owing to certain confusions, the Central Board of Direct Tax vide the Circular No.36/2016 dated 25.08.2016 came out with a clarification. For the sake of brevity, only relevant portion of the circular is re-produced herein:- "3. As no distinction has been made between the compensation received for compulsory acquisition of agricultural land and non-agricultural land in the matter of providing exemption from income-tax under the RFCTLARR Act, ....