ITO, MEERUT vs. SMT. MAYA RASTOGI, MEERUT

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ITA 3875/DEL/2013Status: DisposedITAT Delhi04 December 2015AY 1998-994 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s decision that the compensation, having already been taxed in earlier assessment years (1991-92 and 1994-95), was wrongly assessed in the current year. Therefore, relief was granted to the extent of amounts already taxed.

What were the facts?

The assessee received compensation for land acquisition in multiple tranches across different assessment years. The High Court reduced the compensation amount, leading to a dispute over the taxability year.

What were the issues?

The primary issue was the correct assessment year for taxing compensation received for land acquisition, especially when the amount was later reduced by a court order.

Which sections of the Income-tax Act were involved?

Section 45(5)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: ‘E’ NEW DELHI

Before: SHRI H. S. SIDHU & SHRI PRASHANT MAHARISHI

For Respondent: Shri P. Dam Kanunjna, Sr. DR

PER H.S. SIDHU, JM ORDER This appeal is filed by Revenue against the order dated 28-3-2013 passed by the Ld. CIT(A), Meerut relating to Assessment Year 1998-99.

2.

The brief facts of the case are brought out in the Ld. CIT(A)’s order vide para nos. 2 to 5 which is extracted below for ready reference.

1.

“2. A land owned by the assessee was acquired by the Land Acquisition Officer, Meerut. Compensation including solatium and interest of Rs. 21,26,757/- was awarded on 1.1.1990 and was received on 30.6.1990 (AT 1991-92). The assessee filed claim for enhancement before the ADJ,

Meerut who enhanced the compensation. The enhanced compensation of Rs. 67,24,575/- was received on 16.8.1993 (AY 1994-95). The State Government had filed an appeal before the High Court of Allahabad which vide its order dated 10.4.1997 (AY 1998-99) has reduced the compensation.

3.

The issue under consideration is the year of taxability of the compensation. The AO relying on the decision of the Allahabd High Court in the case of Lakshman Das (246 ITR 622), held that the entire amount of compensation is assessable in AY 1998-99. According to the assessee, in view of sub-section 5 of Section 45 and specifically Clauses (a), (b) and (c) thereof, the compensation is assessable in the year of receipt i.e. AY 1991-92 & 1994-95.

4.

A reference was made to the JCIT, Range-I, Meerut to decide the accessibility as it was informed by the assessee that reassessment proceedings for AYs 1991-92 and 1994- 95 were in progress before the AO.

5. Vide letter dated 28.3.2013, the ITO, Ward-1(4), Meerut has informed that in this connection, it is submitted that assessee had received compensation in AY 1991-92 and 1994-95, which was assessable u/s. 45(5) of I.T. Act in AY 1991-92 and 1994-95 vide order u/s. 143(3)/147 dated 12.3.2013. “

3. The First Appellate Authority vide his order 28.3.2013 has granted the relief to the Assessee and allow the appeal.

4. Against the Ld. CIT(A)’s order dated 28.3.2013, Revenue is in appeal before the Tribunal.

5.

In this case, Notice of hearing to the assessee was sent by the Registered AD post, in spite of the same, assessee, nor his authorized representative appeared to prosecute the matter in dispute, nor filed any application for adjournment. Keeping in view the facts and circumstances of the present case and the issue involved in the present Appeal, we are of the view that no useful purpose would be served to issue notice again and again to the assessee, therefore, we are deciding the present appeal exparte qua assessee, after hearing the Ld. DR and perusing the records.

6.

Ld. DR relied upon the order of the AO and reiterated the contentions raised in the grounds of appeal

and requested that the order of the Ld. CIT(A) may be quashed.

7. We have heard both the parties and perused the records, especially the orders of the revenue authorities. We find that the Ld. CIT(A) has elaborately discussed the issue in dispute and held as under:- “6. All the grounds of appeal relate to the assessment of the amount received as compensation in the year under consideration. As the amounts have already been brought to tax in AY 1991-92 and AY 1994-95 in the orders for these years u/s. 147/143(3) of the Act by the ITO, Ward 1(4), Meerut in his orders dated 12.3.2013, the compensation assessed to tax in this year is held to be wrongly made. AO is directed to give relief to the assessee to extent of compensation brought to tax in AYs 1991-92 & 1994-95.”

7.1 Keeping in view of the facts and circumstances of the case, we are of the view that Ld. CIT(A) has rightly held that as the amounts in dispute have already been brought to tax in AY 1991-92 and A.Y. 1994-95 in the orders for these years u/s. 147/143(3) of the Act by the ITO, Ward-1(4), Meerut in his order dated 12.3.2013, the compensation assessed to tax in this year was held to be wrongly made. Therefore, the Ld. CIT(A)’s action in directing the AO to give the relief to the assessee to the extent of compensation brought to tax in AY 1991-92 & 1994-95 was a well reasoned action, which does not need any interference on our part, hence, we uphold the same and dismiss the Appeal of the Revenue on the issue in dispute.

8.

In the result, the Appeal filed by the Revenue is dismissed.

Order pronounced in the open court on 04/12/2015.

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