“compulsory acquisition”

Capital GainsSection 45(5)Section 45(5)516 judgments

The decision most relied on for compulsory acquisition is CIT v. Ghanshyam (HUF) (315 ITR 1), cited in 363 judgments on BharatTax.

Leading authorities on compulsory acquisition

CIT v. Ghanshyam (HUF)

315 ITR 1 · 2009 · Supreme Court

363

citing judgments

Interest received under Section 28 of the Land Acquisition Act, 1894, is considered part of the enhanced compensation on compulsory acquisition of land. It is taxable as 'capital gains' and not separately as 'interest income' under the head Income from Other Sources.

Mahender Pal Narang v. CBDT

161 Taxmann.com 301 · 2024 · High Court

178

citing judgments

Interest received as enhanced compensation under Section 28 of the Land Acquisition Act, 1894, for compulsory acquisition of land is taxable as "income from other sources" under Sections 56(2)(viii) and 57(iv) of the Income-tax Act, 1961, and is not exempt under Section 10(37).

Movaliya Bhikhubhai Balabhai v. ITO TDS

388 ITR 343 · 2016 · High Court

128

citing judgments

Interest paid on compensation or enhanced compensation for compulsory acquisition of land forms part of the compensation itself and is not taxable as interest income under section 56(2)(viii) or section 145A.

Sham Lal Narula (Dr.) v. CIT

53 ITR 151 · 1964 · Supreme Court

100

citing judgments

Interest received under Section 28 of the Land Acquisition Act, 1894, on enhanced compensation does not form part of the compensation itself but is taxable as 'income from other sources', analogous to interest under Section 34 of the Act.

(supra), Rama Bai v. CIT

181 ITR 408 · 1990 · Supreme Court

citing judgments

Interest received on delayed payment or enhanced compensation awarded under compulsory acquisition is a revenue receipt and is liable to income tax.

Shri Manjeet Singh HUF v. UOI & Others in CWP No. 15506 of 2013; Shri Puneet Singh vs. CIT

110 Taxmann.com 116 · 2019 · Reported

citing judgments

Interest received on compensation or enhanced compensation from compulsory acquisition of land is taxable under the head 'Income from other sources' in the year of receipt, as per the amended provisions, with a 50% deduction available under section 57(iv).

Bikram Singh v. Land Acquisition Collector

224 ITR 551 · 1997 · Supreme Court

citing judgments

Interest received as income on delayed payment of compensation under Sections 28 or 31 of the Land Acquisition Act is a taxable revenue receipt, chargeable to income tax under the head 'income from other sources'.

CIT v. Hindustan Housing and Land Development Trust Ltd.

161 ITR 524 · 1986 · Supreme Court

citing judgments

Income does not arise or accrue when the right to receive payment or compensation is inchoate, contingent, or in dispute, as such a right does not create a debt. This principle determines the correct year of taxability, particularly for compensation under litigation.

Judgments citing compulsory acquisition

Swarajyam Dontireddy, Guntur vs. Income Tax Officer, Ward-2(1), Guntur

In the result, all the 4 appeals of the assessee are allowed

ITA 217/VIZ/2024[2016-17]Status: DisposedITAT Visakhapatnam13 May 2025AY 2016-17

Bench: Shri Vijay Pal Rao, Vice-A N D Shri S. Balakrishnanappeal No. Assessee Respondent A.Y 209/Viz/2024 Konda Srinivasa Income Tax Officer 2016-17 Reddy, Guntur, Ward 2(1) Pan:Aafhk9821E Guntur 216/Viz/2024 Veerareddy Gogula - Do - -Do- Guntur Pan:Byapg6481J - Do - 217/Viz/2024 Swarajyam -Do- Dontireddy Guntur Pan:Cmmpd3393K - Do - 218/Viz/2024 Vijaya Lakshmi -Do- Ravula, Guntur Pan:Baopr0163G

For Appellant: Shri C. Subrahmanyam, CAFor Respondent: : Shri Satyasai Rath, DR

Section 143(2)Section 143(3)Section 147Section 148Section 151Section 2(47)Section 263Section 53A

capital asset, includes- (i) the sale, exchange or relinquishment of the asset; or (ii) the extinguishment of any rights therein; or (iii) the compulsory acquisition thereof under any law; or (iv) in a case where the asset is converted by the owner thereof into, or is treated

Veerareddy Gogula, Guntur vs. Income Tax Officer, Ward-2(1), Guntur

In the result, all the 4 appeals of the assessee are allowed

ITA 216/VIZ/2024[2016-17]Status: DisposedITAT Visakhapatnam13 May 2025AY 2016-17

For Appellant: Shri C. Subrahmanyam, CAFor Respondent: : Shri Satyasai Rath, DR

Section 143(2)Section 143(3)Section 147Section 148Section 151Section 2(47)Section 263Section 53A

Konda Srinivasa Reddy, Guntur vs. Income Tax Officer, Ward-2(1), Guntur

In the result, all the 4 appeals of the assessee are allowed

ITA 209/VIZ/2024[2016-17]Status: DisposedITAT Visakhapatnam13 May 2025AY 2016-17

For Appellant: Shri C. Subrahmanyam, CAFor Respondent: : Shri Satyasai Rath, DR

Section 143(2)Section 143(3)Section 147Section 148Section 151Section 2(47)Section 263Section 53A

Income Tax Officer, Salisbury Park vs. Sangram Vishwasrao Kachare, Wadgaosheri

In the result, both the appeal of the Revenue and the Cross

ITA 1986/PUN/2024[2020-21]Status: DisposedITAT Pune08 May 2025AY 2020-21

Bench: Shri Manish Borad & Ms. Astha Chandra

For Appellant: Shri N.K. Rander &For Respondent: Shri Arvind Desai, Addl. CIT-DR

Section 143(2)Section 144Section 69A

some of his agricultural lands and some of the lands have also been acquired by the NHAI (National Highway Authority of India) under compulsory acquisition of land and even after that the agricultural income of the assessee has jumped from Rs.23,38,285/- in AY 2018-19 or Rs.29 ... assessee sold out some of his agricultural lands and some lands have also been acquired by the NHAI (National Highway Authority of India) under compulsory acquisition of land and even after that the agricultural income of the assessee has strip jumped from Rs.23

Chandrakant Viththal Bhopi, Raigad vs. ITO Ward 1, Panvel

In the result, the appeal filed by the assessee is allowed

ITA 2405/PUN/2024[2016-17]Status: DisposedITAT Pune07 May 2025AY 2016-17

Bench: Shri R. K. Panda & Ms. Astha Chandraassessment Year : 2016-17 Chandrakant Viththal Bhopi Ito, Ward-1, Panvel At Chinchpada, Post Panvel, Tal. Vs. Panvel, Dist. Raigad – 410206 Pan: Bjdpb7610L (Appellant) (Respondent) Assessee By : Shri Nikhil S Pathak & Ajinkya M Vaishampayan Department By : Shri Ramnath P Murkunde Date Of Hearing : 05-05-2025 Date Of Pronouncement : 07-05-2025 O R D E R

For Appellant: Shri Nikhil S Pathak &For Respondent: Shri Ramnath P Murkunde

Section 11Section 142(1)Section 147Section 148Section 148ASection 151Section 2(14)Section 28Section 56(2)(viii)

interest u/s 28 forms part of the compensation awarded u/s 11 of the Land Acquisition Act, 1894 against the compulsory acquisition of rural agricultural land and further a Capital Receipt, and 2 c. The land compulsorily acquired was not a Capital Asset as defined u/s 2(14) of the Income ... dated 20.06.2022 through e- proceedings, stated as under (reproduced) "Under Section 10(37) of the Income Tax Act. Capital Gains on compensation received on compulsory acquisition of urban agricultural land is exempt from tax. The learned assessing officer is not correct while making assessment without properly taken into consideration

Shyam Sunder Gupta, Kanpur vs. Dy. Commissioner of Income Tax-1, Kanpur

ITA 168/LKW/2017[2012-13]Status: DisposedITAT Lucknow06 May 2025AY 2012-13

Bench: Shri Kul Bharat & Shri Nikhil Choudhary

For Appellant: Respondent byFor Respondent: Date of hearing

Section 150Section 150(1)Section 153(3)(ii)Section 2(22)(e)Section 251(2)Section 41(1)

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH “A”, LUCKNOW BEFORE SHRI KUL BHARAT, VICE PRESIDENT AND SHRI NIKHIL CHOUDHARY

Kuljeet Singh, Gurgaon vs. ITO, Ward 2(2), Gurgaon

The appeal of the assessee is dismissed

ITA 2981/DEL/2023[2018-19]Status: DisposedITAT Delhi01 May 2025AY 2018-19

Bench: Shri S. Rifaur Rahman & Shri Anubhav Sharmaassessment Year: 2018-19 Kuljeet Singh, Vs Ito, C/O Ca R.S. Poonia, Ward-2(2), D-82-B, Siwad Area, Gurgaon. Krishna Marg, Bapu Nagar, Jaipur – 302015, Rajasthan. Pan: Cphps3205R (Appellant) (Respondent) Assessee By : None Revenue By : Shri Om Prakash, Sr. Dr Date Of Hearing : 01.05.2025 Date Of Pronouncement : 01.05.2025 Order Per Anubhav Sharma, Jm: This Appeal Is Preferred By The Assessee Against The Order Dated 31.08.2023 Of The Commissioner Of Income-Tax (Appeals), Nfac, Delhi (Hereinafter Referred To As The Ld. First Appellate Authority Or ‘The Ld. Faa’, For Short) In Appeal No.Nfac/2017-18/10040192 Arising Out Of The Appeal Before It Against The Order Dated 17.03.2021 Passed U/S 143(3) R.W.S. 143(3A) & 143(3B) Of The Income Tax Act, 1961 (Hereinafter Referred As ‘The Act’) By The National Assessment Centre, Delhi (Hereinafter Referred To As The Ld. Ao).

For Appellant: NoneFor Respondent: Shri Om Prakash, Sr. DR

Section 10Section 10(37)Section 143(3)

assessee had claimed the exemption on the basis of interest earned by way of enhanced compensation out of compulsory acquisition of agricultural land which the tax authorities have considered as ‘Income from other sources’. In this regard, we find that the Hon’ble P&H, High Court in the case

Daya Ram, Gurgaon vs. PCIT, Rohtak

In the result, appeal of the assessee is allowed

ITA 2268/DEL/2024[2013-14]Status: DisposedITAT Delhi17 Apr 2025AY 2013-14

Bench: Shri Satbeer Singh Godara & Shri Manish Agarwaldaya Ram, Vs. Pcit, Village Patauda Khera, Rohtak Po Patauda, Distt-Jhajjar, Haryana (Appellant) (Respondent) Pan: Avrpr0237L Assessee By : Shri Jai Bhagwan Saini, Adv Revenue By: Shri Surender Pal, Cit Dr Date Of Hearing 17/04/2025 Date Of Pronouncement 17/04/2025

For Appellant: Shri Jai Bhagwan Saini, AdvFor Respondent: Shri Surender Pal, CIT DR

Section 10(37)Section 142(1)Section 143Section 143(1)(a)Section 143(2)Section 143(3)Section 147Section 263Section 28Section 56(2)(viii)

Land Acquisition Act. The assessee responded vide letter (copy at pages 3-58 of Paper Book) that the assessee received enhanced compensation on compulsory acquisition of his agricultural land by Haryana Govt. of Rs. 6,86,17,767/¬which included interest under section 28 of Land Acquisition ... year of receipt as per section 45(5) of the Act. However, in the case of an individual or HUF such capital gain from compulsory acquisition of agricultural land being capital asset is exempt from tax under section 10(37) of the Act. 6.4 The Ld. AR pointed

Sh. Rajesh Kakkar, Karnal vs. Pr. CIT, Karnal

The appeal is allowed

ITA 823/DEL/2016[2011-12]Status: DisposedITAT Delhi16 Apr 2025AY 2011-12

Bench: Shri Anubhav Sharma & Shri Manish Agarwalassessment Year: 2013-14 Sigma Paradise, Vs Dcit, Km-78, Kavi Nagar, Ward 2(2)(1), Ghaziabad, Ghaziabad. Uttar Pradesh – 201 002. Pan:Aazfs9643L (Appellants) (Respondents) Assessee By : Shri Rajiv Khandelwal, Ca; & Shri Gagan R. Khandelwal & Shri Jaind Kumar Jaiswal, Advocates Revenue By : Shri Manish Gupta, Sr. Dr Date Of Hearing : 18.09.2025 Date Of Pronouncement : 26.11.2025

For Appellant: Shri Rajiv Khandelwal, CA; &For Respondent: Shri Manish Gupta, Sr. DR

Section 11Section 143(3)Section 147Section 148Section 4Section 50CSection 6

order enclosed) 4. Even though for stamp Purpose the market value of land was declared Rs.13200/- per sq Meter the land is under compulsory acquisition, the actual value of land as on date is 1000/- M2 as declared by state Government. 5. After all this even assessee has sold land ... they purchased land at Rs 6000/- per sq mt. 6. Keep in view of above mentioned facts that as the land is under compulsory acquisition and value declared by State Government was too low. Respectfully acquisition and value adopted for the purpose of stamp 3 duty

Ajay Bakliwal, Kota vs. ACIT, Central Circle, Kota

In the result, the appeal of the assessee is allowed

ITA 1275/JPR/2024[2012-13]Status: DisposedITAT Jaipur11 Apr 2025AY 2012-13

For Appellant: Sh. Rajendra Sisodia, AdvFor Respondent: Mrs. Anita Rinesh, JCIT-DR

Section 129Section 132(1)Section 139Section 142Section 143(2)Section 143(3)Section 147Section 148Section 153ASection 2(22)(e)

shall include all profits of the company up to the date of liquidation, but shall not, where the liquidation is consequent on the compulsory acquisition of its undertaking by the Government or a corporation owned or controlled by the Government under any law for the time being in force, include

Claqyx Securities P.Ltd, New Delhi vs. ITO, Ward-6(2), New Delhi

ITA 1520/DEL/2019[2012-13]Status: DisposedITAT Delhi07 Apr 2025AY 2012-13

Bench: Shri S. Rifaur Rahman & Shri Anubhav Sharmaita No.1517/Del/2023 (Assessment Year 2015-16)

Section 143(1)Section 154Section 250

Subsequently, rectification application u/s 154 of the Act was filed by the assessee on the basis of that interest receipt from HUDA on compulsory acquisition of land compensation is not taxable and reliance was placed on few decisions upon Hon’ble Supreme Court and of this Tribunal, however, vide order

Shiv Narayan, Haryana vs. DCIT, Circle-3(1), Haryana

In the result, appeal of the assessee is allowed

ITA 2196/DEL/2022[2018-19]Status: DisposedITAT Delhi03 Apr 2025AY 2018-19

Bench: Shri Satbeer Singh Godara & Shri M. Balaganeshassessment Year: 2018-19 Sh. Shiv Narayan, Vs. Dcit, H. No. 137, V & Po, Circle-3(1), Shikohpur, Haryana Gurgaon, Haryana Pan:Akfpn6891B (Appellant) (Respondent)

Section 10(37)Section 142(1)Section 143Section 143(1)(a)Section 143(2)Section 143(3)Section 263Section 28Section 56(2)(viii)Section 57

Land Acquisition Act. The assessee responded vide letter (copy at pages 3-58 of Paper Book) that the assessee received enhanced compensation on compulsory acquisition of his agricultural land by Haryana Govt. of Rs. 6,86,17,767/- which included interest under section 28 of Land Acquisition ... year of receipt as per section 45(5) of the Act. However, in the case of an individual or HUF such capital gain from compulsory acquisition of agricultural land being capital asset is exempt from tax under section 10(37) of the Act. 6.4 The Ld. AR pointed

Malini, Thirunindravur vs. ACIT, Ncc-22(1), Tambaram

In the result the appeal of the assessee is allowed

ITA 2362/CHNY/2024[2018-19]Status: DisposedITAT Chennai27 Mar 2025AY 2018-19

Bench: Shri Duvvuru Rl Reddyand Shri S.R. Raghunathaआयकरअपीलसं/.Ita No.:2362/Chny/2024 िनधा"रणवष"/Assessment Year:2018-19 Malini, The Assistant Commissioner Of 7, Ganapathy Puram, Near Vs. Income Tax, Ragvendra Nagar, Periyapalayam Non Corporate Circle 22(1), (Tbm), Road, Thiruninravur 602 024, Chennai. Tamil Nadu. [Pan: Ajspm-9167-B] (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथ"क"ओरसे/Appellant By : Shri D. Anand, Advocate ""यथ"क"ओरसे/Respondent By : Ms. Gauthami Manivasagam, Jcit सुनवाईक"तारीख/Date Of Hearing : 24.03.2025 घोषणाक"तारीख/Date Of Pronouncement : 27.03.2025 आदेश/ O R D E R Per Duvvuru Rl Reddy, Vice-: This Appeal Filed By The Assessee Is Directed Against The Order Of The Ld. Commissioner Of Income Tax (Appeals), National Faceless Appeal Centre (Nfac), Delhi Dated 25.06.2024 Passed Under Section 250 Of The Income Tax Act, 1961 (Hereinafter Called ‘The Act’). The Relevant Assessment Year Is 2018-19. 2. We Find That This Appeal Is Filed With A Delay Of 17 Days. The Assessee Filed A Petition For Condonation Of Delay Explaining Reasons For The Said Delay & Prayed For Condonation Of That Delay. On Perusal Of The Condonation Petition & Upon Hearing The Ld. Ar & Ld. Dr, We Find That The Reasons Explained By The Assessee Are Bonafide & Therefore, The Delay Is Condoned & Admitted The Appeal For Adjudication.

For Appellant: Shri D. Anand, AdvocateFor Respondent: Ms. Gauthami Manivasagam, JCIT

Section 142(1)Section 143(2)Section 145ASection 250Section 56(2)(viii)Section 57

Assessing Officer made an addition of ₹.97,44,420/- being 50% on the interest receipt on enhanced compensation on compulsory acquisition of land liable to be tax as “income from other sources” under section 56(2)(viii) of the Act. 5. Aggrieved, the assessee preferred an appeal before ... submissions, the ld. CIT(A) dismissed the ground raised by the assessee for the reason that the interest payment received on compensation/enhanced compensation on compulsory acquisition of land is taxable as income from other sources as per the provisions of section 56(2)(viii) r.w.s. 57(iv) and section 145A

M/S Balaji Developers, Dhule vs. ITO, Ward 1, Dhule

In the result, the appeal of the assessee is allowed

ITA 375/PUN/2024[2016-17]Status: DisposedITAT Pune24 Mar 2025AY 2016-17

Bench: Dr.Manish Borad & Shri Vinay Bhamoreआयकर अपील सं. / Ita No.375/Pun/2024 Assessment Year : 2016-17

For Appellant: Shri Sanket M. JoshiFor Respondent: Shri Ramnath P. Murkunde

Section 143(2)Section 143(3)Section 250Section 96

learned CIT(A) erred in confirming the addition of Rs.2,74,48,078made by the A.O by holding that the income arising on compulsory acquisition of land held as stock in trade by the appellant firm was taxable as business income under the Income Tax Act, 1961 without appreciating that ... failed to appreciate that even though the impugned land was held by the appellant firm as stock in trade, the income arising on compulsory acquisition of the said land was exempt from taxation u/s 96 of the RFCTLAAR Act 2013 and hence, the addition made

Vijay Kumar, New Delhi vs. Income Tax Officer, Ward-29(1), Minto Road New Delhi

In the result, appeal of the assessee is allowed

ITA 3466/DEL/2024[2019-20]Status: DisposedITAT Delhi24 Mar 2025AY 2019-20

Bench: Shri Satbeer Singh Godara & Shri Manish Agarwal

Section 10(37)Section 142(1)Section 143Section 143(1)(a)Section 143(2)Section 143(3)Section 263Section 28Section 56(2)(viii)Section 57

Land Acquisition Act. The assessee responded vide letter (copy at pages 3-58 of Paper Book) that the assessee received enhanced compensation on compulsory acquisition of his agricultural land by Haryana Govt. of Rs. 6,86,17,767/- which included interest under section 28 of Land Acquisition ... year of receipt as per section 45(5) of the Act. However, in the case of an individual or HUF such capital gain from compulsory acquisition of agricultural land being capital asset is exempt from tax under section 10(37) of the Act. 6.4 The Ld. AR pointed

Income Tax Officer, Karnal vs. Opinder Singh Virk, Karnal

In the result, the appeal of the Revenue in ITA No

ITA 1095/DEL/2024[2011]Status: DisposedITAT Delhi21 Mar 2025

Bench: Ms. Madhumita Roy & Shri Naveen Chandra

For Appellant: NoneFor Respondent: Shri Amit Katoch, Sr. DR

Section 143(3)Section 147Section 148Section 148(2)

Rs.6,19,31,108 according to the appellant) was received by the appellant as enhanced compensation and interest thereon on account of compulsory acquisition of property. The appellant made various investment out of this compensation which was credited in the Indusind Bank. These investments became the subject of re- assessment

ACIT, Central Circle-1, Nashik vs. Rajendra Rasiklal Shah, Nashik

ITA 1016/PUN/2024[2016-17]Status: DisposedITAT Pune20 Mar 2025AY 2016-17

Bench: Dr. Manish Borad & Ms. Astha Chandraआयकर अपील सं. / Ita No.1016/Pun/2024

Section 143(1)Section 143(2)Section 147Section 250Section 56(2)(vii)

permissions, is completed by sellers. Substantial rights in land transferred to purchasers including right to receive TDR in name of purchasers in case of compulsory acquisition of land by Nashik Municipal Corporation [clause 2]. Possession of land received by the assessee with the right to handover the possession

Krishan Pal Singh HUF, Jaipur vs. Assessing Officer, Jaipur

In the result, the appeal of the assessee is allowed

ITA 1268/JPR/2024[2018-2019]Status: DisposedITAT Jaipur19 Feb 2025AY 2018-2019

Bench: the Ld CIT (Appeals).

For Appellant: Shri N. K. Agarwal, CA &For Respondent: Mrs. Swapnil Parihar, JCIT-DR

Section 10(37)Section 142(1)Section 143(2)Section 143(3)Section 28

Income Tax Officer (Para 21 to 23) IT: Interest received by assessee u/s 28 of Land Acquisition Act 1894 on enhanced compensation received for compulsory acquisition agriculture land for period from acquisition of land till payment of compensation to assessee was part of compensation and thus same was not taxable ... Basavaraj M Kudarikannur (See Para 11 and 14) IT: interest awarded u/s 28 of the Land Acquisition Act 1894 on enhanced compensation paid for compulsory acquisition of agriculture land would be eligible for exemption under section 10(37) 7. In re: Sumesh Kumar Vs I T O (ITAT New Delhi

Narsi Reddy Komatireddy, Hyderabad vs. DCIT., Central Circle-2(2), Hyderabad

In the result, the appeal is allowed

ITA 121/HYD/2021[2017-18]Status: DisposedITAT Hyderabad13 Feb 2025AY 2017-18

Bench: Shri Vijay Pal Rao & Shri Madhusudan Sawdia

For Appellant: Shri K.C. Devdas, C.AFor Respondent: : Shri Waseem Ur Rehman, SR-DR

Section 132Section 153ASection 45

Narsi Reddy Komatireddy, Hyderabad vs. Srig. Santosh Kumar, Deputy Commissioner of Income Tax, Central Circle-2(2), Hyderabad

In the result, the appeal is allowed

ITA 120/HYD/2021[2015-16]Status: DisposedITAT Hyderabad13 Feb 2025AY 2015-16

Bench: Shri Vijay Pal Rao & Shri Madhusudan Sawdia

For Appellant: Shri K.C. Devdas, C.AFor Respondent: : Shri Waseem Ur Rehman, SR-DR

Section 132Section 153ASection 45