2023 (12) TMI 705

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....he Land Acquisition Officer u/s 28 of the Land Acquisition Act and making an addition of Rs. 51,31,595/= u/s 56 to the total Income of the appellant. Further, the Commissioner of Income Tax (A) National Faceless Appeal Center Delhi also erred in not allowing the appeal of the appellant on wrong interpretation of the Judgments of the Honourable Supreme Court. 2. The Appellant carves leave to add, amend alter or delete any other ground or grounds at any time during the pendency of the appeal." 3. The assessee filed return of income declaring nil income at Rs. 6,10,530/- on 22-03-2017. The case was selected for scrutiny for the reason that gross receipt shown in schedule 0S of ITR is less than the receipts reported in 26AS u/s . 193 and lar....

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....tion in this case is as to whether interest on enhanced compensation should be exempt u/s 10(37) as claimed by the assessee or should be taxable u/s 56(2)(viii) r.w.s. 145A(b) and 57(iv) as held by the Department. The assessee in this case has mainly relied on the decision of Hon'ble Gujarat High Court in the case of Movaliya Bhikhubhai Balabhai Vs ITO, TDS-1, Surat 388 ITR 343 which, relying upon the Hon'ble Supreme Court judgement in the case of CIT Vs Ghanshyam (HUF) [2009] 182 taxman 368/315 ITR 1 (SC) has held that interest paid on compensation/enhanced compensation u/s 28 of Land Acquisition Act forms part of compensation and not interest as contemplated u/s 145A and therefore is not taxable under the head income from other so....

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....tion of tax at source relying upon Circular No. 5 of 2010 held that amendment to the provisions of the 1961 Act by Finance Act, 2010 Act was not in connection with the decision of Supreme Court in Ghanshyam's case (supra) but to mitigate the hardship caused by the of the 1894 Act continues to part take the character of compensation and will not fall within the ambit of expression "interest". In view of discussion above, we with utmost respect are not in agreement with the view taken by Gujarat High Court. There is another aspect, i.e. the language of sections 56(2)(viii) and 57(iv) of the 1961 Act is plain, simple and unambiguous. There is no scope of taking outside aid for giving an interpretation to newly inserted subsections and clau....

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....s given in the case of Ghanshyam (HUF) and Bikram Singh (supra) and decided in the following words: "We have perused para-24 & 25 of the judgement of the Apex Court in "Commissioner of Income Tax v. Ghanshyam" (supra), We find that the Hon'ble Apex Court there was not called upon to look into the larger bench judgment delivered earlier in the case of Bikram Singh (supra). In para-7 the Honourable larger bench has found that the interest paid u/s 28 is not by way of any charge on compensation determined u/s 23(1). We, therefore, with respect, follow the large Bench judgement of the Honourable Apex Court." 6. The Hon'ble Apex Court has consistently held in a catena of judicial pronouncements in the cases of Dr. Shamlal Narula Vs. ....