Compulsory acquisition compensation is not a GST supply, making tax deductions from land acquisition awards unlawful and refundable.

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....Compulsory acquisition of land and attached structures under eminent-domain powers is an expropriation, not a supply of goods or services for GST purposes. Land and buildings are immovable property and cannot be treated as goods, while a landowner does not provide any service through statutory acquisition. GST deducted from acquisition compensation therefore lacks statutory basis, is beyond the acquiring authority's power, and must be refunded with interest. Interest awarded on compensation under the Land Acquisition Act to account for the period until payment forms part of compensation and is not subject to tax deduction at source.....