T. VENKATAPPA, J.M. ORDER This is wealth-tax appeal for asst. yr. 1976-77. valuation date is 31st March, 1976. assessee owned 1 hectare 64 acres of agricultural land. Government of KERALA acquired this land under KERALA Land Acquisition act, 1961. possession of land was taken over on 28th Nov., 1975. award was passed by land Acquisition Officer on 16th Oct., 1976 awarding amount of Rs. 3,07,124 which included solution and interest. WTO held that form 28th Nov., 1975 assessee has no right in land but has only right to receive compensation. right to receive compensation is movable asset which has to be assessed to wealth-tax. Thus, he completed assessment by including total compensation received by assessee. After deducting wealth-tax liability and proportionate interest for period after 31st March, 1976, he determined taxable wealth at Rs. 3,00,500. On appeal AAC upheld same. Against same assessee has preferred this appeal. 2. learned counsel for assessee strongly urged that it is only after award was passed on 16th Oct., 1976 that property vests in Government and prior to that assessee has all rights in property. Thus, during this year agriculture land was owned by assessee and it is exempt under WT Act, 1957 ('the Act'). right to receive compensation accrues or arises on passing of award on 16th Oct., 1976. Hence, during this year compensation amount cannot be included in net wealth of assessee. He also pointed out that neither in earlier year nor in subsequent year assessee was assessed to wealth-tax. He placed reliance on decisions in Kerala State housing Board vs. Ammalukutty (1983) 38 CTR (Guj) 276 : (1983) KLT 112, CIT vs. Purshottambhai Maganbhai Hatheesing (HUF) (1985) 156 ITR 150 (Guj), Buddaiah vs. CIT (1985) 155 ITR 277 (Kar) and Harish Chandra vs. CIT (1985) 154 ITR 487 (Del). On facts he submitted that compensation for land acquired as such was Rs. 2,23,190 and value of building in which assessee was residing was Rs. 40,000. building is exempt under Act and agricultural land to extent of Rs. 1,50,000 is also exempt. It that is allowed assessee does not have any taxable wealth. 3 . learned Departmental representative strongly urged that once possession of land is taken over by Government, assessee gets right to receive compensation from that date. That right arises immediately on dispossession. Since possession has been taken over on 28th Nov., 1975, right to receive compensation which is asset is includible in net wealth. Thus, amount of compensation received has been rightly included in net wealth of assessee. In this connection, he placed reliance on decisions in CIT vs. Mother India Refrigeration Industries (P) Ltd. (1985) 48 CTR (SC) 176 : (1985) 155 ITR 711 (SC) and CIT vs. A. B. V. Gowda (1984) 42 CTR (Kar) 265 : (1986) 157 ITR 697 (Kar). 4. We have considered rival submission. question for consideration is when land acquired under land Acquisition Act, 1894, would vest with Government. To decide this issue it will be necessary to examine provisions of Kerala Land Acquisition Act to find out when tile vest with Government Sec. 3 of said Act deals with publication of preliminary notification. Sec. 5 of said Act deals with objections filed by persons interested in land. Under s. 6 of said Act declaration shall be made that land is acquired for public purpose. Under s. 9 of said Act public notice shall be given stating that Government intends to take possession of land and calling claims for compensation. Sec. 11 of said Act deals with enquiry by Collector and passing of award determining compensation to be awarded for land. Sec. 18 of said Act provides that when collector has made award under s. 11 he may take possession of land which shall thereupon vest absolutely in Government free from all encumbrances. This is similar to s. 16 of Land Acquisition Act (Central). This is exception to his under s. 19 of Kerala land acquisition act where in case of urgency though no award has been made Collector on expiry of 15 days from date of notice mentioned in s. 9 can take possession of land which shall thereupon vests absolutely in Government free from all encumbrances. This provision is similar to s. 17 of Land Acquisition Act (central). title to land vests in Government when Collector takes possession of those lands either under s. 18 or under s. 19. In instant case, s. 19 has not been invoked. perusal of above provisions would clearly show that it is only after award is passed, Collector may take possession of land which shall thereupon absolutely vests in Government free from all encumbrances. In instant case, possession was given voluntarily by assessee on 28th Nov., 1975 before award was passed on 16th Oct., 1976 by land Acquisition Officer. Since possession was already given prior to award, question of taking possession again did not arise. Thus, land vests in Government on 16th Oct., 1976 when award has been given though possession was taken over earlier. Prior to 16th Oct., 1976 property did not vest with Government and assessee had rights in land. Thus, as on valuation date 31st March, 1976 assessee owned agricultural land. As title did not vest in Government on that date, she did not have any right to receive compensation on that date. Hence, right to receive compensation which arose on 16th Oct., 1976 was not available to assessee on 31st March, 1976. Thus, WTO is not justified in including compensation received by assessee after valuation date 31st March, 1976 in net wealth of assessee for this year. 5. In Jetmulla Bhojraj vs. State of Bihar AIR 1972 SC 1363, Supreme Court held that Government becomes owner of lands notified for acquisition only when Collector takes possession of those lands either under s. 16 or under s. 17(1) and until and unless possession is taken over under those provisions, lands notified for acquiescent do not vest in Government. In Kerala State Housing Board's case (supra) land Acquisition Officer took possession of land on 21st May, 1979 on voluntary surrender of land by land owners. award extension P2 was passed subsequently. On those facts it was held that as possession of land was already with Housing Board there cannot be further taking over of possession by State. Since award unambiguously declares vesting of land in Government after taking possession said declaration amounts to vesting of land in Government since possession had already been taken. Thus, it was held that land had vested absolutely in Government by award passed by Land Acquisition Officer. above decisions squarely apply to instant case. facts in case of Kerala State Housing Board (supra) are almost identical to facts of instant case as in both cases, land owners gave possession of land to Government prior to passing of award. In that case also provisions of s. 17(1) were not invoked. 6 . In Purshottambhai Maganbhai Hatheesing (HUF) case (supra) possession of land was taken on 29th Dec., 1970 by private negotiations but not in exercise of powers under s. 17. award was passed by land Acquisition Officer on 3rd Feb., 1971. question arose as to in which year transfer of property is effected for purpose of s. 45 of IT Act, 1961. Gujarat High Court held that transfer is effected when possession is taken over pursuant to award under provisions of land Acquisition Act, since under s. 11 on award being made, property vest in Government free from all encumbrances. On facts of that case it was held that capital gains could have been brought to tax in year 1972-73, since award was made on 3rd Feb., 1971 and possession which though taken earlier in December, 1970 would not vest title to property in Government till award is made. facts in that case are identical to facts of instant case before us and ratio squarely applies. 7 . full Bench decision of Kerala High Court in case of peter John vs. CIT (1986) 157 ITR 711 is distinguishable. That is case relating to awarding of interest on compensation awarded. While considering that aspect it was held that owner of land is entitled to be paid value of land on date of taking over of possession and interest has to be allowed from date of possession. question as to when title to land vests in Government did not come up for consideration directly in that case. Same is position in decision of Karantaka High Court in case of A. B. V. Gowda (supra). Thus, on careful consideration of entire facts, we are of view that title to land has vested in Government on 16th Oct., 1976. Prior to that date assessee was owner of land. Hence, on valuation date as on 31st March, 1976 assessee was owner of agricultural land and on that date she did not have any right to receive compensation. Thus, compensation amount receivable in respect of receive compensation. Thus, compensation amount receivable in respect of land is not includible in net wealth of assessee. bifurcation of Rs. 3,07,524 received as compensation is as under : Rs. Market value of land 2,23,119.40 Value of building 40,341.40 Solatium at 15 per cent 37,828.00 Interest 6,235.27 3,07,524.07 residential building valuing Rs. 40,341.40 is exempt under s. 5(1) (iv) of Act. Agricultural land to extent of Rs. 1,50,000 is also exempt under s. 5(1) (iva). After excluding above, there is no taxable wealth. Thus, we cancel order AAC and Assessment order. 8. In result, appeal is allowed. *** SMT. L. KAMAKSHI AMMA v. WEALTH-TAX OFFICER