| Case ID |
229cbe5a-76a1-4bb4-9a67-46906972b20a |
| Body |
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| Case Number |
C.W.P. No. 21077 of 2008 |
| Decision Date |
Aug 13, 2009 |
| Hearing Date |
Aug 13, 2009 |
| Decision |
The petition filed under Article 226 of the Constitution sought the refund of Rs. 2,19,779 deducted as tax at source from enhanced compensation awarded for land acquired by the State of Haryana. The court held that under Section 194A of the Income-tax Act, TDS must be deducted from interest realized from enhanced compensation as it is considered a revenue receipt. The court reaffirmed that interest on delayed payment of compensation is taxable under the Income-tax Act and is not characterized as damages or compensation for retained possession. The petition was dismissed as the issues raised were covered by previous judgments. |
| Summary |
The case of Sant Ram v. Union of India addresses the legality of tax deductions under Section 194A of the Income-tax Act, 1961, specifically regarding interest on enhanced compensation from land acquisition. The Punjab and Haryana High Court ruled that TDS is applicable as the interest constitutes a revenue receipt. This ruling aligns with established precedents that classify interest on delayed payments as taxable income. The case emphasizes the importance of understanding tax obligations in compensation scenarios, particularly regarding agricultural land and enhanced compensation claims. Legal professionals must remain vigilant about such tax implications to ensure compliance and avoid unnecessary financial burdens. The ruling reinforces the principle that interest, seen as a revenue receipt, is subject to taxation, thereby affirming the necessity for taxpayers to account for these deductions in their financial assessments. This case serves as a crucial reference point for future disputes involving tax deductions on compensation-related interests. |
| Court |
Punjab and Haryana High Court
|
| Entities Involved |
Not available
|
| Judges |
M. M. Kumar,
Jaswant Singh
|
| Lawyers |
Saurav,
Surinder S. Kalimmna,
Sunil Nehra
|
| Petitioners |
Sant Ram
|
| Respondents |
Union of India
|
| Citations |
2010 SLD 2919,
(2010) 328 ITR 77
|
| Other Citations |
Bhula Ram v. UOI (C. W. P. No. 1493 of 2001, decided on 23-9-2009),
Bikram Singh v. Land Acquisition Collector [1997] 224 ITR 551 (SC),
T.N.K. Govindaraju Chetty v. CIT [1967] 66 ITR 465 (SC),
Karnail Singh v. State of Haryana [2010] 326 ITR 501 (Punj. & Har.),
K.S. Krishna Rao v. CIT [1990] 181 ITR 408 (SC),
Dr. Sham Lal Narula v. CIT [1964] 53 ITR 151 (SC)
|
| Laws Involved |
Income-tax Act, 1961,
Land Acquisition Act, 1894
|
| Sections |
194A,
194LA
|