Purushaindra Kumar Kaurav JUDGMENT
Purushaindra Kumar Kaurav, J.
1. The present appeal involves an examination of the taxability of the interest component, earned on compensation or enhanced compensation, ordered under Land Acquisition Act, 1894 ["Act of 1894"].
2. The instant appeal has been preferred by the Revenue against the order passed by the Income Tax Appellate Tribunal ["ITAT"] dated 19.06.2020, whereby, the ITAT deleted the addition made by the Assessing Officer ["AO"] under Section 56(2)(viii) of the Income Tax Act, 1961 ["Act"] for the Assessment Year ["AY"] 2016-17.
3. We may note that vide order dated 15.12.2023, we had briefly noticed the substantial questions of law arising in the present appeal in terms of paragraph Nos. 5 and 5.1, which read as under:-
"5. The central issue which arises for consideration is: whether interest received by the respondent/assessee under Section 28 and 34 of the Land Acquisition Act, 1894 would fall under the provisions of Section 10(37) and Section 56(2)(viii) of the Income Tax Act, 1961 [in short, "Act"]?
5.1. We may note that it would also be necessary to examine the provisions of Section 45(5)(c) of the Act."
4. At the outset, we are formally admitting the instant appeal on the following substantial question of law:-
Whether the ITAT has erred in setting aside the concurrent view of the AO and the Commissioner of Income Tax (Appeals) ["CIT(A)"] which held that after amendment of Section 56 of the Act vide Finance (No. 2) Act, 2009 (w.e.f. 01.04.2010), no benefit can be derived by the respondent-assessee from the decision of the Hon'ble Supreme Court in the case of CIT v. Ghanshyam (HUF) [MANU/SC/1208/2009 : 2009:INSC:913 : (2009) 315 ITR 1 (SC)]?
5. The facts of the case would show that the respondent-assessee had filed its Income Tax Return ["ITR"] on 05.08.2016, declaring the income to the tune of Rs. 3,08,920/-. The said ITR filed by the respondent-assessee was selected for scrutiny and a notice dated 24.04.2017 was served upon him under Section 143(2) of the Act. Subsequently, another notice under Section 142(1) of the Act was issued, calling upon the respondent-assessee to furnish the relevant information as asked for. The reply to the said notice was duly submitted by the respondent-assessee.
6. Upon perusal of the aforesaid reply and the material which was placed on record, the AO found that the respondent-assessee had claimed an exemption on the receipt of income amounting to Rs. 26,93,84,780/-on the basis of the following grounds:-
i. Compensation on compulsory acquisition of land amounting to Rs. 18,86,63,176/-.
ii. Interest received on the said acquisition amounting to Rs. 8,02,13,161/-and,
iii. Dividend income to the tune of Rs. 5,08,443/-.
7. Thereafter, the AO vide email dated 13.11.2018, made an enquiry under Section 133(6) of the Act fro........