2022 (3) TMI 777

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.... (in short 'Act'). 2. Brief facts of the case are that the assessee is an individual, doing his finance business, filed return of income for the A.Y.2016-17 declaring income of Rs. 48,78,230/- under the heads, 'income from Salary', 'income from House Property', 'income from profits and gains from business', 'income from capital gains' and also income from other sources'. The case was selected for scrutiny under CASS. A notice u/s 143(2) of the Act was issued and served on the assessee. The assessment was completed u/s 143(3) of the Act, assessed taxable income at Rs. 49,67,730/-. The Ld.Pr.CIT initiated proceedings u/s 263 of the Act and examined the assessment records. Upon perusal of the records, it is noticed that the assessee receive....

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....r the RFCTLARR Act, 2013 (Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013) towards compulsory acquisition f land and I directing the assessing officer to assess the said compensation amount as long term capital gains. 4. The learned Principal Commissioner of Income Tax ought to have appreciated that the assessing officer conducted enquiries in respect of the above issue and as such it is not a case of 'lack of inquiry' to enable the learned Principal Commissioner of Income Tax to invoke the provisions of S.263 of the Act. 5. Any other ground that may be urged at the time of appeal hearing. 4. Ground No.1 and 5 are general in nature which does not require specifi....

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....undisputed fact that the assessee had received compensation of Rs. 1,33,88,000/- under compulsory acquisition of land under RFCTLARR Act. The Ld.Counsel for the assessee has heavily relied on the Circular 36/2015 dated 25.10.2016 issued by the CBDT, wherein, it was mentioned that income tax shall not be levied on any award or agreement made (except those made under section 46) under the RFCTLARR Act. Therefore, compensation received for compulsory acquisition of land under the RFCTLARR Act (except those made under section 46 of RFCTLARR Act), is exempted from the levy of income-tax. On perusal of the para 2 of the Circular, it is not covered u/s 46 of the RFCTLARR Act. We have also perused the provision of section 96 of the RFCTLARR Act. Fo....