Vinod Prabhudayal Agrawal vs. ITO, Ward-1, Dhule

Parties Involved

Facts Summary

The assessee, Vinod Prabhudayal Agrawal, filed an appeal against the order of the Ld. CIT(A)/NFAC, Delhi, dated 24.03.2025, relating to the assessment year 2018-19. The assessee had filed an income return declaring a total income of Rs.49,79,080/-. The case was selected for limited scrutiny assessment under the E-assessment Scheme, 2019. The assessee claimed exemption for the interest received on enhanced compensation amounting to Rs.63,44,261/- from NHAI on compulsory acquisition of agricultural land. The Assessing Officer made an addition of Rs.31,72,131/- as income from other sources u/s 56(2)(viii) of the Act. The Ld. CIT(A)/NFAC upheld the action of the Assessing Officer.…

Legal Issues

• 1. Whether the interest on enhanced compensation on compulsory acquisition of agricultural lands is exempt from payment of Income Tax under section 96 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013?
• 2. Whether the learned CIT(A), NFAC erred in law and on facts in sustaining the addition made by the learned AO of Rs.31,72,131/- u/s 56(2)(viii) of the ITA, 1961?
• 3. Whether the interest received by appellant u/s 28 of the Land Acquisition Act, 1894 forms part of enhanced compensation and is exempt u/s 10(37) of the ITA, 1961?
• 4. Whether the learned CIT(A), NFAC and the learned AO erred in treating interest received on enhanced compensation as taxable?

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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