| Case ID |
43107ba7-97e1-4d2c-8277-ef000ba3bc0e |
| Body |
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| Case Number |
Income-tax Reference No.48 of 1987 |
| Decision Date |
Jul 21, 1994 |
| Hearing Date |
|
| Decision |
The Income-tax Appellate Tribunal was justified in upholding the decision of the Commissioner of Income-tax (Appeals) in deleting the sum of Rs.9,90,000 from the income of the assessee. The Tribunal concluded that since the claims made by the assessee for compensation were still pending and had not been finally determined, it was premature to treat the claimed amounts as income for the current assessment year. The Income-tax Officer was directed to assess the final amount once it was determined, thereby allowing the Revenue to tax it accordingly in the future. |
| Summary |
In this significant case concerning the Income Tax Act, 1961, the Rajasthan High Court examined the nature of income and the conditions under which it is assessable. The case revolved around the claim made by the assessee for compensation due to the closure of liquor shops mandated by the government. The tribunal determined that mere claims for compensation do not constitute actual income unless they have been received or are deemed to have been received. The court emphasized that the income must be ascertained and not merely claimed, leading to the conclusion that the amount claimed by the assessee could not be taxed until it was formally recognized as income. This case highlights the importance of finality in claims for income tax purposes and sets a precedent for similar future cases, ensuring clarity in the application of the Income Tax Act. The decision reinforces the understanding that income must be realized before it can be subjected to tax, a crucial aspect for taxpayers and legal practitioners alike. |
| Court |
Rajasthan High Court
|
| Entities Involved |
Not available
|
| Judges |
V.K. Singhal,
V.G. Palshikar
|
| Lawyers |
D.S. Shishodia, Senior Advocate,
S. Bhandawat,
J.L. Dagga
|
| Petitioners |
COMMISSIONER OF Income Tax
|
| Respondents |
REHMAT KHAN
|
| Citations |
1997 SLD 150,
(1995) 74 TAX 67,
1997 PTD 1238,
(1995) 213 ITR 134
|
| Other Citations |
CIT v. Hindustan Housing and Land Development Trust Ltd. (1986) 161 ITR 524 (SC)
|
| Laws Involved |
Income Tax Act, 1961
|
| Sections |
2(45),
4,
5
|