TaxTMI 
TaxTMI 
2023 (11) TMI 583
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....ereinafter referred to as 'the Act') dated 07.12.2018. The assessee has raised the following ground of appeal: - Section Issue Ground of Appeal Sec.10(27) Solatium received u/s 28 of Land Acquisition on Act be held as not interest chargeable u/s 56 of the Inc Tax Act 1961 Since, the appellant has received solatium u/s 28 of the Land Acquisition Act along with increased compensation the same is not an interest received as envisaged in Section 56 of the Income Tax Act 1961, and is not chargeable to tax, since, the same is received on compulsory acquisition of the Agricultural Land Situated in the remote area having a population of less than 10000. Section 56 Addition of Rs. 42,07,939 on account of solatium on increased compensati....
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....ivil Judge, Gondal is filed. The Ld. AR for the assessee submits that the enhanced compensation does not contain any interest as per Section 34 of Land Acquisition Act, 1894. The compensation, enhanced compensation, solatium and interest on such enhanced compensation is not taxable as per the decision of Hon'ble Apex Court in the case of CIT vs. Ghanshyam (HUF) 315 ITR 1, 182 Taxman 368 (SC). The Ld. AR for the assessee further submits that Ld.CIT(A) allowed 50% relief to assessee, which is without basis. 3. On the other hand, Ld. Sr-DR for the Revenue supported the order of NFAC/Ld. CIT(A) and submits that assessee has already got 50% relief. Though, ld CIT(A) allowed partial relief and the revenue has not filed due to low tax effect. The....
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.... income of Rs. 1,62,284/- the assessee received from Central Bank of India, the assessee stated that such interest could not be included in total income due to mistake. The assessee submitted that he has no objection if interest received from Central Bank of India is added to his income. Though, the assessee objected for making addition on part of compensation received against acquisition of such land. The Assessing Officer not accepted the contention of assessee and entire compensation included the interest thereon treated as "income from other sources". 5. Aggrieved by the addition made by Assessing Officer the assessee filed appeal before Ld. CIT(A). Before Ld. CIT(A) assessee submitted that his agricultural land was acquired by State G....
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....he Government of Gujarat to pay difference amounts i.e., original amount awarded by Land Acquisition Collector vis-à-vis the enhanced compensation awarded by Ld. Principal Senior Civil Judge, Gondal to the assessee and other interested persons, with interest @ 9% for first year and @ 15% for remaining years, together with solatium @ 30% on additional amount from the date of notification issued till the date of award. I find that Ld. Principal Senior Civil Judge, Gondal while granting such interest in excess of sum which was awarded by Land Acquisition Collector, as per the Section 28 of Land Acquisition Act, 1894. For appreciation of facts, the provisions of Section 28 and under Section 34 of the Land Acquisition Act, 1894 is extract....
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....hich has not been paid or deposited before the date of such interest income is received. 7. On careful perusal of award, I find that the assessee was granted additional compensation and the statutory interest as per Section 28 of Land Acquisition Act, 1894. I find that Hon'ble Apex Court in the case of Ghanshyam (HUF) (supra) while considering the taxability of compensation on acquisition of asset held that interest paid on excess amount under section 28 of Land Acquisition Act, 1894 is a part of amount of compensation, however, interest under section 34 is only for delay in making payment after compensation is determined interest under section 28 of Land Acquisition Act, 1894 a part of enhanced value of land. Thus, this statutory interest....