TaxTMI 
TaxTMI 
2024 (1) TMI 1575
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....cts & circumstances of the case, Ld. PCTT has erred in law and on facts in setting aside the order passed by the assessing officer u/s 143(3) dated 09. 02-2021 with the direction to pass an order afresh in accordance with law and further erred in holding that AO failed to conduct proper enquiries with respect to amended provisions of Finance Act, 2015 & binding decision of jurisdictional High Court and Hon'ble Apex Court with regard to interest on enhanced compensation and that too by recording incorrect facts and findings and without observing the principles of natural justice and more particularly when all the details/information/evidences were available on the record at the time of assessment proceedings. 3. In any view of the matter and in any case, order passed under section 263 is bad in law and against the facts and circumstances of the case & is barred by limitation and the same is not sustainable on various legal and factual grounds. 4. That the appellant craves the leave to add, amend, modify, delete any of the grounds of appeal before or at the time of hearing and all the above grounds are without prejudice to each other." 3. Briefly stated, the ....
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....pensation. 5. Aggrieved, the assessee is in appeal before the Tribunal and all the grounds relate thereto. 6. We have heard the Ld. Representatives of the parties and perused the records. Their arguments have duly been considered carefully. 7. The facts are not in dispute. The assessee received Rs. 5,42,98,962/- as interest on enhanced compensation from the Indian Oil Corporation Ltd. after the compulsory acquisition of her agricultural land on which TDS amounting to Rs. 54,29,869/- @ 10% was also deducted u/s 194A of the Act. In her return the assessee claimed the said interest as exempt. 8. On perusal of case records, the Ld. PCIT gathered that the Ld. AO had completed the assessment without carrying out necessary and proper enquiry which should have been made regarding applicable judgments on the taxability of interest on enhanced compensation. The Hon'ble Punjab & Haryana High Court has given the finding that interest received on compensation or enhanced compensation will be taxed as per amended provisions introduced through Finance (No. 2) Act, 2009 w.e.f. 01.04.2010 and the judgment of the Hon'ble Supreme Court in the case of CIT vs. Ghanshyam HUF would not come t....
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....l Narang's case (supra) against which SLP stands dismissed by the Hon'ble Supreme Court. This is not so. During assessment proceedings in response to notice under section 143(2) and 142(1) of the Act, with reference to specific query on receipt of interest under section 28 of Land Acquisition Act, the assessee explained that interest received under section 28 of the Land Acquisition Act has been held to be part of compensation by Apex Court in the case of CIT vs. Ghanshyam HUF reported as (2009) 315 ITR 1, the same being exempt under section 10(37) of the Act has not been included in the total income of the assessee while filing return of income. The Ld. AO accepted the explanation of the assessee. 11. The issue of amended provisions of section 56(2)(viii) by the Finance Act, 2009 and the decision of Hon'ble P & H High Court in Mahender Pal Narang's case was raised by the Ld. PCIT in notice under section 263 on the basis of audit objection. Before the Ld. PCIT the assessee explained that the amended provisions were not in connection with the decision of Hon'ble Supreme Court in Ghanshyam HUF's case but to make simple the taxation of interest income as earlier it was taxable on a....
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....ct of Hon'ble Supreme Court's ruling in the case of Rama Bai and not Ghanshyam HUF. Moreover, the decision in Ghanshyam HUF was pronounced in July, 2016 and the Finance Bill proposing amendment to section 56 was laid in February 2016. So, the intention of the legislature could never be the overruling of the ratio laid down in Ghanshyam HUF case. The issue in Rama Bai case involved the taxability in the year of receipt. The facts and questions for determination in Rama Bai's case were different from those of Ghanshyam HUF's case. The position in Ghanshyam HUF'a case has been affirmed by the Hon'ble Supreme Court in UOI vs. Hari Singh (2018) 91 taxmann.com 20 (SC). 13. We have gone through the decision of the Hon'ble P & H High Court in the case of Mahender Pal Narang (supra). In that case the land of the assessee was acquired in AY 2007-08 and 2008-09. The enhanced compensation was received on 21.03.2016. In his return filed for AY 2016-17 he treated the interest received under section 28 of the 1894 Act as income from other sources and claimed deduction for 50% as per section 57(iv) of the 1961 Act. The return was processed under section 143(1) of the Act. An application under s....