2025 (1) TMI 643

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....This appeal by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi (hereinafter referred to as 'the CIT(A)') dated 04.12.2023, for assessment year 2018-19. 2. The solitary issue raised by the assessee in appeal is against confirming addition of interest u/s. 28 of the Land Acquisition Act, 1894 on enhanced compensation....

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....eceived. The assessee claimed interest as part of the compensation and exempt from tax u/s. 10(37) of the Act in accordance with law laid down by the Hon'ble Supreme Court of India in the case of CIT vs. Ghanshyam HUF, 2009 (8) SCC 412/315 ITR 1. In assessment proceedings, the Assessing Officer treated the interest awarded to the assessee on enhanced compensation, as "Income from Other Sources....

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....the case of CIT vs Ghanshyam HUF (supra) has held that interest received on compensation/enhanced compensation is part of compensation, hence, exigible to tax u/s. 45(5) of the Act. The Hon'ble Punjab and Haryana High Court in the case of Mahender Pal Narang vs CBDT, 120 taxmann.com 400 (P&H) after considering amended provisions of section 56(2) of the Act distinguished the decision rendered i....