Mukesh Kumar Vs ITO (ITAT Chandigarh)
The Chandigarh Bench of the Income Tax Appellate Tribunal Chandigarh dealt with an appeal for AY 2015–16 arising from a reassessment framed under sections 147 read with 144B. The assessee had originally declared a small income, but the case was reopened to tax interest received on enhanced compensation under the Land Acquisition Act. The Assessing Officer treated the interest as taxable under section 56(2)(viii), allowed the statutory 50% deduction, denied deduction under section 80C for lack of evidence, and treated the compensation for agricultural land as income from other sources, determining a substantially higher income. The first appellate authority confirmed the assessment due to non-compliance.
Before the Tribunal, it was noted that the taxability of interest on land compensation stood covered against the assessee by a recent Tribunal decision, and the assessee had already offered 50% of such interest to tax, which had been accepted. However, the amount of ₹9,01,726 claimed as exempt agricultural income represented compensation for acquisition of agricultural land, and the assessee sought an opportunity to substantiate its exemption claim under section 10(37). The assessee also requested another chance to support the deduction claimed under section 80C. Accepting this request, the Tribunal restored both issues—the taxability of agricultural land compensation and the deduction under section 80C—to the Assessing Officer for fresh verification. The appeal was allowed for statistical purposes.
