ITO, PANCHKULA vs. SH. VIRENDER SINGH, PANCHKULA

आदेश/Order

Per Sanjay Garg, Judicial Member:

The captioned are the cross appeals, one by the assessee and other by the Revenue against the order dated 29.03.2016 of the Commissioner of Income Tax (Appeals), Panchkula [hereinafter referred to as CIT(A)].

ITA Nos. 399 & 740/Chd/2016 Sh. Varinder Singh, Panchkula 2

interest on enhanced compensation on compulsory acquisition of

agricultural land. Before the Assessing officer, the assessee pleaded that

the land in question which was compulsory acquired by Government was an

agricultural land. However, the Assessing officer observed that earlier the

land of one Shri Yoginder Singh was also acquired and the same was

treated as non-agricultural land and accordingly was treated as capital

asset exigible to capital gains tax. The Assessing officer further observed

that assessee inherited the land of said Sh. Yoginder Singh, being his legal

heir, hence, the same proposition will apply to the land in question.

Further, that the assessee even did not furnish any reliance evidence to

show that the land was an agricultural land. He, therefore, treated the land

in question as capital asset and assessed the capital gain tax accordingly on

the compensation received by the assessee and further the interest received

on the said compensation was treated as ‘income from other sources’.

assessee preferred an appeal before the Ld. CIT(A). Before the Ld.

CIT(A), the assessee submitted certain documents in the shape of

‘Jamabandi’ etc. and pleaded that the land in question was agricultural

land. The Ld. CIT(A) admitted these documents in evidence and held the

land in question was agricultural land. However, in respect of the interest

received on enhanced compensation, he held that he same was to be

treated as ‘income from other sources’/.

ITA Nos. 399 & 740/Chd/2016 Sh. Varinder Singh, Panchkula 3

come in appeal pleading that the Ld. CIT(A) without properly examining

the documents, and even without giving opportunity to the Assessing

officer to examine and rebut those documents, has in a mechanical manner

held that the land in question was an agricultural land.

pleading that the Ld. CIT(A) wrongly treated the interest on the enhanced

compensation as ‘income from other sources’ and further that in the light

of the decision of the Hon'ble Supreme Court in the case of case of ‘CIT

Vs. Ghanshyam (HUF) (2009) 115 ITR 1, the interest received on

enhanced compensation is to be treated as part of the compensation and as

such was not exigible to taxation.

of the assessee. So far as the issue as to the taxability of interest received

on enhanced compensation u/s 28 of the Land Acquisition Act is cornered,

the same is squarely covered by the decision of this Tribunal in the group

of cases with lead case in ‘Shri Satbir Vs. ITO & others’ in ITA Nos.

1413 to 1415/Chd/2016 vide order dated 9.7.2018, another group of cases

with lead case in ‘ITO Vs. Sh. Nachhattar Singh & Others’ in M.A. Nos.

61/Chd/2014 (in ITA Nos. 564/Chd/2010) order dated 7.2.2018 and also

in the case of ‘Som Nath, Yamunanagar Vs. ITO’ in ITA No.

552/Chd/2016 order dated 11.7.2018, wherein, the Tribunal after

considering the decision of the Hon'ble Supreme Court in the case of ‘CIT

Vs. Ghanshyam (HUF)(supra) , and the decision of the Hon'ble Punjab &

ITA Nos. 399 & 740/Chd/2016 Sh. Varinder Singh, Panchkula 4

Haryana High Court in the case of ‘Manjeet Singh (HUF) Karta Manjeet

Singh Vs. UOI’ in CWP No. 15506 of 2013 dated 14.01.2014 and further

decision of the Hon'ble Supreme Court in ‘UOI Vs. Hari Singh and others

in Civil appeal No. 1504 of 2017 dated 15.9.2017 and another decision of

the Hon'ble Supreme Court in ‘CIT Vs. Chet Ram (HUF)’ dated 12.9.2017

in Civil appeal No. 13053/2017 has held that that the interest received by

an assessee on compulsory acquisition of agricultural land u/s 28 of the

Land Acquisition Act, is to be treated as part of the compensation and

further that the compensation being exempt u/s 10(37) of the Act is not

exigible to the tax.

agricultural land or not, we find that the Ld. CIT(A) has simply relied upon

the documents furnished by the assessee and has not given any opportunity

to the Assessing officer to examine the same. Moreover, the land in

question is a large chunk of land, a part of which may be agricultural land

or part of which may not be. The record submitted by the assessee requires

through scrutiny. We, therefore, restore this factual issue to the file of the

Assessing officer to examine the land records submitted by the assessee

including the ‘jamabandi’ / ‘Khasra Girdawari’ and also to conduct

necessary enquiries, if so required, to find out whether the entire land or

part thereof is agricultural land and if found so, then to allow the relief to

the assessee accordingly in accordance with law in the light of the

decisions of the Tribunal in the case of ‘Shri Satbir Vs. ITO & Ors’ (supra)

and in the case of ‘ ITO Vs. Sh. Nachhattar Singh and Ors’ (supra). This

ITA Nos. 399 & 740/Chd/2016 Sh. Varinder Singh, Panchkula 5

matter in both the appeals is therefore, restored to the file of the Assessing officer for adjudication afresh as directed above. In the result, both the appeals are treated as allowed for statistical purposes.

Order pronounced in the Open Court on 13.12.2018.

Sd/- Sd/- ( बी , आर . आर . कुमार / B.R.R. KUMAR) (संजय गग� / SANJAY GARG ) लेखा सद�य/ Accountant Member �या�यक सद�य /Judicial Member

Dated : 13.12. 2018 “आर.के.”

आदेश क� ��त�ल�प अ�े�षत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकर आयु�त/ CIT 4. आयकर आयु�त (अपील)/ The CIT(A) 5. �वभागीय ��त�न�ध, आयकर अपील�य आ�धकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड� फाईल/ Guard File आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar