MRS. USHA WAMANRAO CHARDE v. COMMISSIONER OF INCOME TAX
[Citation -2007-LL-0418-3]
| Citation | 2007-LL-0418-3 |
|---|---|
| Appellant Name | MRS. USHA WAMANRAO CHARDE |
| Respondent Name | COMMISSIONER OF INCOME TAX |
| Court | ITAT |
| Relevant Act | Income-tax |
| Date of Order | 18/04/2007 |
| Assessment Year | 1981-82, 1982-83 |
| Judgment | View Judgment |
| Keyword Tags | enhanced compensation • reference application • agricultural income • immovable property • irrigation project • state government • land acquisition • revenue receipt • cross-objection • capital receipt |
| Bot Summary: | In these cases, possession of agricultural land belonging to the assessee was taken over by the State Government for irrigation project by negotiations, even before initiating proceedings under the Land Acquisition Act. After taking over the possession of the agricultural lands, the land acquisition proceedings were initiated and on completion of the proceedings three awards were passed on July 31, 1981, August 31, 1981, and May 19, 1982, determining the compensation under the Land Acquisition Act. The assessee contended that since the possession of the lands were taken over even before initiating proceedings under the Land Acquisition Act, the enhanced compensation payable from April 1, 1979, till the date of the award would be agricultural income, and therefore, interest payable thereon would be capital receipt and not taxable. On appeal filed by the assessee before the Commissioner of Income-tax, the Commissioner of Income-tax held that the interest from April 1, 1979, till the date of award is a capital receipt and the capital receipts have to be assessed as capital gains in accordance with the law. The Tribunal held that the interest received was a revenue receipt and rejected the cross-objection filed by the assessee. On a reference application filed by the assessee the Tribunal relied upon the judgment of the hon ble apex court in the case of Dr. Shamlal Narula v. CIT 1964 53 ITR 151 and rejected the application filed by the assessee, hence the present application is filed by the assessee. The questions in these cases is where the possession of the immovable property is taken by the State Government even before initiating the proceedings under the Land Acquisition Act, and thereafter enhanced compensation is paid with interest, whether the amount of interest received from the date of possession up to date of the award would be a capital receipt or revenue receipt The decision of the Kerala High Court in the case of Periyar and Pareekanni Rubbers Ltd. 1973 87 ITR 666, which has distinguished the decision of the apex court in the case of Dr. Shamlal Narula 1964 53 ITR 151, has not been considered by the Tribunal. |