2021 (9) TMI 37

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....e assessee's claim of deduction u/s 54 of the IT Act, 1961?" 2. The facts giving rise to the present appeal are that the return of income declaring total income of Rs. 4,53,85,150/- was filed by the assessee on 03.08.2012. Thereafter, the case was selected for scrutiny. While framing the scrutiny assessment, the Assessing Officer observed that on perusal of the computation, it was seen that the assessee had received enhanced compensation of Rs. 13,15,68,759/- (inclusive of interest) on account of compulsory acquisition of his immovable property held in the year 2001-02. The assessee had disclosed Rs. 5,44,45,242/- as enhanced compensation and Rs. 7,71,23,517/- as interest income on enhanced compensation under the head of income from othe....

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....ccept the explanation offered by the assessee and proceeded to make addition of Rs. 4,55,00,000/- in respect of enhanced compensation. Thus, he assessed the income at Rs. 4,53,85,150/- against the income declared as per the return of Rs. 4,55,00,000/- 3. Aggrieved against this, the assessee preferred appeal before Ld.CIT(A), who after considering the submissions and relying upon the provision of section 54H of the Act and the case laws as relied upon by the Ld. Counsel for the assessee, allowed the claim of deduction u/s 54H of the Act. 4. Now, the Revenue is in appeal before this Tribunal. 5. Ld. Sr. DR on behalf of the Revenue vehemently argued that Ld.CIT(A) was not justified in allowing the claim of the assessee. Ld. Sr. DR str....

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....he acquisition itself. In other words, there was an intrinsic link between the reference which led to the enhancement and the acquisition u/s 54(H) of the Act. 7. We have heard the rival contentions of the parties and perused the material available on record. For effective adjudication and clarity, section 54H of the Act is reproduced hereunder:- 54H. "Notwithstanding anything contained in sections 54, 54B, 54D, 54EC and 54F, where the transfer of the original asset is by way of compulsory acquisition under any law and the amount of compensation awarded for such acquisition is not received by the assessee on the date of such transfer, the period for acquiring the new asset by the assessee referred to in those sections or, as the....