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Interest on Land Acquisition Compensation Taxable as Capital Receipt
Case Law Details
- Case Name
- Lakhi Ram Vs ITO (ITAT Delhi)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Related Assessment Year
- 2019-20
- Courts
- All ITAT, ITAT Delhi
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Lakhi Ram Vs ITO (ITAT Delhi)
Interest u/s 28 of Land Acquisition Act Forms Part of Compensation—Taxable as Capital Receipt, Not “Income from Other Sources”
The Delhi ITAT (E Bench) allowed the appeal of Lakhi Ram for AY 2019-20, holding that interest received under section 28 of the Land Acquisition Act, 1894 is an integral part of enhanced compensation and cannot be assessed as “income from other sources” under sections 56(2)(viii), 57(iv) and 145A(b).
The Tribunal held that:
Interest u/s 28 is accretion to the value of land and forms part of enhanced compensation, as consiste...
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