Case Law Details
Madaparambil Varkey Varghese Vs ACIT (Kerala High Court)
The compensation awarded for the acquisition of land, buildings etc of the petitioner by Kochi Metro Rail Project is Rs.7,54,24,705/-. During the Assessment Year 2016-17 the petitioner has received 80% of the compensation determined through Award dated 30.10.2015. While computing the net taxable income of the petitioner-assessee, Assessing Officer has included the compensation amount of 80% received in the subject Assessment Year and assessed the income of the petitioner. Hence the writ petition.
Language of Section 96 of the RFCTLAAR Act, 2013 is clear and unambiguous and there is no need to refer to intention or find out other ways and means to include the compensation received by the petitioner for any purpose of tax liability including the capital gains.
Section 96 mandates that no income-tax shall be levied on any award made under the Act except under Section 46. Section 46 deals with the purchase of land by a person other than a specified person through private negotiations. The benefit of Section 96 is not available when a land is purchased through private negotiations by a person other than a specified person under Section 46(1).
Therefore, in cases other than those covered by Section 46 of the 2013 Land Acquisition Act, the levy of income-tax is barred by Section 96 and as a consequence, the deduction or collection under Section 194LA of the Income Tax Act, 1961, is impermissible.
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