ITA No. 1839/Del/2024

Parties Involved

Facts Summary

The assessee, Dharam Singh, is the legal heir of Late Smt. Bati Devi. Late Bati Devi sold her land in Faridabad to M/s Triveni Infrastructure Development Company Ltd (TIDCL) for industrial purposes in 2006. Part payment was received, but the balance remained unpaid. The sale deed was later cancelled by the court. The land was subsequently acquired by the Haryana Government, and Dharam Singh received compensation. He claimed exemption under Section 10(37) of the Income-tax Act, 1961 for the compensation received. The Assessing Officer (AO) disallowed the exemption, considering the land a capital asset. The Commissioner of Income-tax (Appeals) (CIT(A)) granted relief, observing that the land was urban agricultural and compulsorily acquired by the government.…

Legal Issues

• 1. Whether the CIT(A) was right in deleting the addition of Rs. 5,00,16,500/- made by the AO on account of capital gain.
• 2. Whether the CIT(A) erred in giving relief to the assessee since the assessee failed to establish that the land is agricultural.
• 3. Whether the CIT(A) erred in allowing the benefit of exemption u/s 10(37) by treating the amount of Rs 5,00,16,500/- as compensation from Haryana Government.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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