The Commissioner Of Income Tax v. Sh. Bharat Lal Dagar (Huf

ITA No. 232 of 2005 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Commissioner of Income Tax Versus Sh. Bharat Lal Dagar (HUF) ITA No. 232 of 2005 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Urvashi Dhugga, Advocate for the appellant. AJAY KUMAR MITTAL, J. 1.This order shall dispose of ITA Nos. 321 of 2004, 232, 358,571 of 2005 and 233 to 237, 247, 248, 415, 416, 536, 541, 548 of 2006as learned counsel for the appellant submitted that similar questions oflaw are involved therein. For brevity, the facts are being taken from ITANo. 232 of 2005. 2.ITA No.232 of 2005 has been preferred by the revenueunder Section 260A of the Income Tax Act, 1961 against the orderdated 27.8.2004 passed by the Income Tax Appellate Tribunal, DelhiBench “F”, New Delhi in ITA No. 475/Del/01 & CO No. 63/Del/104, forthe assessment year 1998-99. 3.According to the learned counsel for the revenue, theappeal raises the following substantial question of law:- “Whether the ITAT is right in law in confirming theorder passed by the CIT(A) and holding that the amount of enhanced compensation and the interestreceived thereon, even though actually received bythe assessee should not be brought to tax since thedispute about the quantum is pending before highercourt and the amount has been released onfurnishing of security?” 4.The facts necessary for adjudicating the presentcontroversy as pleaded in the appeal are that the assessee receivedenhanced compensation of the land acquired by the Haryana UrbanDevelopment Authority and also interest accrued thereon during theassessment year 1998-99 but in the return filed by him, the assesseedid not offer the amount of enhanced compensation and interest on theground that in view of the judgment passed by the Hon'ble SupremeCourt in CIT v. Hindustan Housing and Land Development TrustLtd., 161 ITR 524 (SC), the amount of enhanced compensation andinterest received had not accrued to the assessee during the year ofreceipt as the entire amount was in dispute in appeal filed by the Statebefore the High Court. The Assessing Officer did not accept the pleaof the assessee and brought the amount of enhanced compensationand interest received by the assessee during the year to tax. Againstthe order of the Assessing Officer, the assessee approached theCommissioner of Income Tax (Appeals) [in short “the CIT(A)”]. The CIT(A) held the income of enhanced compensation and interest as “capitalgains” to be charged in the year of receipt. The percentage of capitalgains arising out of payments received by the assessee againstfurnishing the security was not to be treated as income for the year, but the remaining amount, if any, not covered by security, was to be treatedas income for the year and charged to tax under the head “CapitalGains”. The CIT(A) further directed to allow deduction under Sections54B and 54F of the Income Tax Act, 1961 (in short “the Act”) from thedate of actual receipt of enhanced compensation. Feeling aggrieved,the revenue filed an appeal before Income Tax Appellate Tribunal, DelhiBench “F”, New Delhi (hereinafter referred to “the Tribunal”). Theassessee filed cross-objections. The Tribunal allowed the cross-objection of the assessee and quashed the order of the CIT(A) to theextent of order relating to taxability of the amount of enhancedcompensation and interest thereon which had been withdrawn withoutfurnishing security and dismissed the appeal of the revenue. Hence,the present appeal by the revenue. 5.We have heard learned counsel for the appellant. 6.The point that arises in this appeal is whether the enhancedcompensation and interest received thereon is taxable in the hands ofthe assessee in the year of receipt. 5.We have heard learned counsel for the appellant. 6.The point that arises in this appeal is whether the enhancedcompensation and interest received thereon is taxable in the hands ofthe assessee in the year of receipt. 7.The similar issue came up for consideration before thisCourt in ITA No. 209 of 2004 (The Commissioner of Income Tax,Faridabad v. Bir Singh (HUF) Ballabgarh) decided on 27.10.2010,wherein it was concluded as under:- “(a)that 'income from Business or profession' and'income from other sources' are ascertain on thebasis of system of accountancy followed by theassessee;'income from other sources' are ascertain on thebasis of system of accountancy followed by theassessee; (b)where assessee is not maintaining books of accounts by adopting any specific method, it shall be treated tobe cash system of accountancy; (c)the interest under Section 34 to be awarded by theCollector partakes the characters of compensationand is taxable in the year of receipt in view of Section45(5)(b) of the Act; and (d)under cash system of accountancy, the element ofinterest awarded by the Court received on enhancedamount of compensation under Section 28 of the1894 Act falls for taxation under Section 56 as'income from other sources' in the year of receipt.” 8.Further, the Apex Court in Commissioner of Income-taxv. Ghanshyam (HUF), [2009] 315 ITR 1 (SC) had held that the amountof enhanced compensation received by the assessee would be taxablein the year of receipt in view of insertion of Section 45(5)(b) of the Actirrespective of whether any litigation is pending at the behest of theState in any court of law. 9.In view of the above, the appeals are allowed and theissues arising therein are answered accordingly. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL)JUDGE ITA No. 232 of 2005 -5- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Commissioner of Income Tax Versus Sh. Sultan Singh ITA No. 321 of 2004 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Urvashi Dhugga, Advocate for the appellant. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL) JUDGE ITA No. 232 of 2005 -6- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Commissioner of Income Tax Versus Sh. Shiv Ram (HUF) ITA No. 358 of 2005 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Urvashi Dhugga, Advocate for the appellant. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL) JUDGE ITA No. 232 of 2005 -7- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Commissioner of Income Tax Versus Sh. Bhoop Lal ITA No. 415 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Urvashi Dhugga, Advocate for the appellant. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL) JUDGE ITA No. 232 of 2005 -8- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Chief Commissioner of Income Tax Versus Shri Shyam Lal ITA No. 416 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. The Commissioner of Income Tax Versus Sh. Bhoop Lal ITA No. 415 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Urvashi Dhugga, Advocate for the appellant. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL) JUDGE ITA No. 232 of 2005 -8- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Chief Commissioner of Income Tax Versus Shri Shyam Lal ITA No. 416 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Urvashi Dhugga, Advocate for the appellant. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL) JUDGE ITA No. 232 of 2005 -9- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Commissioner of Income Tax Versus Sh. Daya Ram (HUF) ITA No. 541 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Urvashi Dhugga, Advocate for the appellant. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL) JUDGE ITA No. 232 of 2005 -10- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Commissioner of Income Tax Versus Sh. Jeevan Singh ITA No. 548 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Urvashi Dhugga, Advocate for the appellant. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL) JUDGE IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Commissioner of Income Tax, Karnal Versus Sh. Bhim Singh Lathar ITA No. 234 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Mr. Yogesh Putney, Advocate for the appellant. Mr. Pankaj Jain, Advocate for the respondent. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL)JUDGE IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Commissioner of Income Tax, Karnal Versus Sh. Bhim Singh Lathar ITA No. 235 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Mr. Yogesh Putney, Advocate for the appellant. Mr. Pankaj Jain, Advocate for the respondent. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL) JUDGE (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL)JUDGE IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Commissioner of Income Tax, Karnal Versus Sh. Bhim Singh Lathar ITA No. 235 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Mr. Yogesh Putney, Advocate for the appellant. Mr. Pankaj Jain, Advocate for the respondent. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL) JUDGE IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Commissioner of Income Tax, Karnal Versus Sh. Bhim Singh Lathar ITA No. 236 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Mr. Yogesh Putney, Advocate for the appellant. Mr. Pankaj Jain, Advocate for the respondent. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL)JUDGE IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Commissioner of Income Tax, Karnal Versus Sh. Bhim Singh Lathar ITA No. 237 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Mr. Yogesh Putney, Advocate for the appellant. Mr. Pankaj Jain, Advocate for the respondent. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. Bharat Lal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL)JUDGE IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 536 of 2006 Date of Decision: 23.11.2010 The Commissioner of Income Tax, Faridabad ....Appellant. Versus Sh. Chet Ram, HUF ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Mr. Yogesh Putney, Advocate for the appellant. Mr. Pankaj Jain, Advocate for the respondent. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL)JUDGE IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH The Commissioner of Income Tax, Karnal Versus Sh. Bhim Singh Lathar ITA No. 233 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Mr. Yogesh Putney, Advocate for the appellant. Mr. Pankaj Jain, Advocate for the respondent. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL)JUDGE IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 571 of 2005 Date of Decision: 23.11.2010 The Commissioner of Income Tax, Faridabad Versus Sh. Dhanpat Rai ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Urvash Dhugga, Advocate for the appellant. Mr. Akshay Bhan, Advocate for the respondent. PRESENT: Mr. Yogesh Putney, Advocate for the appellant. Mr. Pankaj Jain, Advocate for the respondent. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL)JUDGE IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 571 of 2005 Date of Decision: 23.11.2010 The Commissioner of Income Tax, Faridabad Versus Sh. Dhanpat Rai ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Urvash Dhugga, Advocate for the appellant. Mr. Akshay Bhan, Advocate for the respondent. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. BharatLal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL) JUDGE -18- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 247 of 2006 Date of Decision: 23.11.2010 Commissioner of Income Tax, Faridabad Versus Smt. Veermati ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Uvashi Dhugga, Advocate for the appellant. Mr. Avneesh Jhingan, Advocate for the respondent. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. Bharat Lal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL) JUDGE IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Commissioner of Income Tax, Faridabad Versus Sh. Lalit Kumar ITA No. 248 of 2006 Date of Decision: 23.11.2010 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Urvashi Dhugga, Advocate for the appellant. None for the respondent. AJAY KUMAR MITTAL, J. The appeal is allowed. For reasons, see the order of even date recorded in ITA No. 232 of 2005 [The Commissioner of Income Tax v. Sh. Bharat Lal Dagar (HUF)]. (AJAY KUMAR MITTAL) JUDGE November 23, 2010gbs (ADARSH KUMAR GOEL) JUDGE