TaxTMI 
TaxTMI 
TaxTMI 
2023 (2) TMI 1388
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....essee. 3. Brief facts of the case are that assessee filed its return of income on 17/10/2016 reporting total income of Rs. 4,67,00,600/- with book profit u/s 115JB of the Act at Rs. 7,87,92,877/-, which was subsequently revised on 23/02/2017 at an income of Rs. 16,14,780/- and book profit u/s 115JB at Rs. 17,93,181/-. Case of the assessee was selected for complete scrutiny through CASS for which statutory notices were issued and served upon assessee. Ld. AO noted that assessee has made part compliance in respect of notices issued to him. Ld. AO, further noted that assessee has claimed exemption of Rs. 2,06,25,199/- towards receipt of "compensation on land" and another Rs. 3,04,03,804/- as interest on the compensation, both of which are exempt as per Section 96 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 ('RFCTLAAR Act'). Ld. AO required assessee to substantiate its claim for which it submitted its reply by referring to CBDT Circular No. 36/2016, dt. 25/10/2016. However, ld. AO noted that provisions of Section 10(37) of the Act provides exemption on the capital gains arising onl....
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.... appellant as it is a Company which is not covered in the definition as contained in sec. 10(37) and is only available to assessees having status of Individual or HUF. Further according to the AO exemption is also not available to the appellant Company as the Circular has not stated to extend the exemption to all categories of assessees. On perusal of section 96 of the RFCTLARR Act, 2013 it is seen that as per the same it states that no income tax or stamp duty shall be levied on any award or agreement made under this Act, except under section 46 and no person claiming under any such award or agreement shall be liable to pay any fee for a copy of the same. Further the Circular No. 36 of 2016 issued by the CBDT in para 3 states that the exemption provided under section 96 of the RFCTLARR Act is wider in scope than the exemption provided under the existing provisions of the Income Tax Act, 1961. It is seen that the RFCTLARR Act, 2013 is a Special Law and that Special Law should prevail over-the General law. Moreover, it is true that under any statue where there is special as well as general provision special provision always prevails. This aspect has been well recognised by t....
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....f the RFCTLARR Act shall also not be taxable under the provisions of Income-tax Act, 1961 even if there is no specific provision of exemption for such compensation in the Income-tax Act, 1961." CBDT Circular No. 36 of 2016, dated 25/10/2016 clarifies that in absence of specific provision under the Income-tax Act, 1961 award under the "RFCTLARR Act, 2013" in the hands of land losers, both for agricultural and non- agricultural land is tax free. In the case of Madaparambil Varkey Varghese Vs ACIT (Kerala High Court) WP(C).No.1908 of 2019 it was held by the Hon'ble court that "Section 96 mandates that no income-tax shall be levied on any award made under the Act except under Section 46. Section 46 deals with the purchase of land by a person other than a specified person through private negotiations. The benefit of Section 96 is not available when a land is purchased through private negotiations by a person other than a specified person under Section 46(1). Therefore, in cases other than those covered by Section 46 of the 2013 Land Acquisition Act, the levy of income-tax is barred by Section 96 and as a consequence, the deduction or collection under Section 194LA of t....
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....s 10(37) of the Act as observed by ld. AO. The only objection of ld. AO is that exemption is not available to assessee, it being a company not covered under the definition as contained in Section 10(37) of the Act as it is available only to assessees having status of "individual" or "HUF". We note that Section 96 of the RFCTLAAR Act, 2013, provides that no income-tax or stamp duty shall be levied on any award or agreement made under this Act except u/s 46 and no person other than a specified person u/s 46(1) of the RFCTLAAR Act, 2013, shall be liable to pay any fee for copy of the same. Further, CBDT Circular no. 36/2016, dated 25/10/2016 in para 3 states that exemption provided u/s 96 of the RFCTLAAR Act, 2013 is wider in scope than exemption provided under the existing provisions of the Act. The operative para 2 & 3 of the CBDT Circular no. 36/2016, dated 25/10/2016, are reproduced as under:- "Para 2. The RFCTLARR Act which came in to effect from 1st January, 2014, in section 96, inter-alia, provides that income-tax shall not be levied on any award or agreement made (except those made under section 46) under the RFCTARR Act. Therefore, compensation received for compulsory acqui....