TaxTMI 
TaxTMI 
2022 (3) TMI 645
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....rder passed by the Income Tax Officer requires to be quashed. It be so done. 3. That it has been held by Hon'ble Supreme Court in case of CIT vs. Ghanshyam Dass HUF that interest awarded u/s. 28 of the Land Acquisition Act is a capital receipt. Hon'ble Apex Court in the case of CIT Vs. Ghanshyam HUF (2009) 315 ITR 1 has held that Interest awarded u/s. 28 of Land Acquisition Act, 1894 is nothing but an accretion to the value of compensation and hence it is part and parcel of compensation. Thus taxability of such interest is of Capital nature and should be included to Consideration received for the purpose of computation of capital gain u/s. 45 of Income Tax Act, 1961. Hence, addition made of Rs. 16,01,945/- be deleted and tax demand of Rs. 764040 is wrong. 4. That This issue has been further decided by the Hon'ble Apex Court in case of Union of India Vs. Hari Singh (Civil Appeal No. 15041/2017 order dated 15th September 2017) wherein it is held that While determining as to whether the compensation paid was for agricultural land or not, the assessing officer will keep in mind the provisions of Section 28 of the Land Acquisition Act and the law laid down ....
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.... The Ld. Counsel for the Assessee furnished the written submissions which read as under: Re: Sawarn Singh S/o. Sh. Niranjan Singh Ref: ITA No. 264/CHD/2021 arising from the Order dated 26.08.2021 of National Faceless Appeal Centre (NFAC) Date Fixed for Hearing: 30.11.2021 Most respectfully, we submit as under: 1. The present appeal is the second appeal arising from the dismissal of First Appeal by National Faceless Appeal Centre (NFAC) Order dated 26.08.2021. 2. In this case the assessee has already submitted the Paper Book. 3. The assessee seeks permission to withdraw second ground of appeal and to add additional grounds of appeal i) On the facts and circumstances of the case the order passed by the learned CIT(A) is bad both in the eyes of law and on facts. ii) On the facts and circumstances of the case the learned CIT(A) has erred both on facts and in law in sustaining the addition on account of interest of enhanced compensation to the extent of interest of Rs. 16,01,945/-. iii) On the facts and circumstance of the case the learned CIT(A) has erred both on facts and in law in confirming the....
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....iman Counsel of the Assessee 7. It was further submitted that the issue under consideration is squarely covered by the decision of the ITAT, Chandigarh Bench "A", Chandigarh in ITA No. 63 & 64/Chd/2020 in the case of ITO, Ward-1, Panchkula Vs. Smt. Chawli Devi, Vill-Ramgarh, Panchkula order dt. 17/05/2021, copy of the said order was furnished which is placed on record. 8. In her rival submissions the Ld. Sr. DR strongly supported the impugned order passed by the Ld. CIT(A) and reiterated the observation made in the impugned order. 9. We have considered the submissions of both the parties and perused the material available on the record. After considering the submissions of both the parties, it is noticed that a similar issue has already been adjudicated by the ITAT, Chandigarh Bench "A", Chandigarh vide order dt. 17/05/2021 in the aforesaid referred to case of ITO Vs. Smt. Chawli Devi (supra) wherein the relevant findings have been given in para 7 which read as under: 7. After considering the submissions of both the parties and the material placed on record, it is noticed that a similar issue having identical facts has already been decided by the ITAT Cha....
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....ed on receipt basis, which means it would be taxed in the year in which it is received. The said findings given in the case of Ghanshyam (HUF) (supra) have been reiterated by the Hon'ble Supreme Court in the case of Govindbhai Mamaiya (supra) observing as under: "In so far as the second question is concerned, that is also covered by another judgment of this Court in Commissioner of Income Tax, Faridabad vs. Ghanshyam (HUF) reported in (2009) 8 SCC 412, 6 albeit, in favour of the Revenue. In that case, the court drew distinction between the "interest" earned under Section 28 of the Land Acquisition Act and the "interest" which is under Section 34 of the said Act. The Court clarified that whereas compensation given to the assessee of the land acquired would be 'income', the enhanced compensation/consideration becomes income by virtue of Section 45(5)(b) of the Income Tax Act. The question was whether it will cover "interest" and if so, what would be the year of taxability. The position in this respect is explained in paras 49 and 50 of the judgment which make the following reading: "49. As discussed hereinabove. Section 23(1-A) provides for additional am....
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....peal No. 13053/2017 wherein also the Hon'ble Supreme Court has again reiterated the proposition laid down in the case of Ghanshyam (HUF) (supra), which we find has been further reiterated in the case of Union of India vs. Hari Singh & others in Civil Appeal No. 1504 of 2017 dated 15.9.2017, as under: "(2) While determining as to whether the compensation paid was for agricultural land or not, the Assessing Officer(s) will keep in mind the provisions of Section 28 of the Land Acquisition Act and the law laid down by this Court in 'Commissioner of Income Tax, Faridabad v. Ghanshyam (HUF)' [2009 (8) SCC 412] in order to ascertain whether the interest given under the said provision amounts to compensation or not." 9.1 The said decision as rightly pointed out by the Ld. counsel for assessee have been rendered by the Hon'ble Apex Court subsequent to the decision passed by the Hon'ble Jurisdictional High Court in the case of Manjeet Singh(HUF) (supra) which had dealt, with the decisions of the Hon'ble Apex Court in Ghanshyam, HUF (supra). Therefore, in view of the same, the proposition laid down in Ghanshyam, HUF (supra) remains and which having be....