RAKESH KUMAR GARG.J. - (1.) CM No. 1082 -CII of 2008 For the reasons stated in the application, delay of 38 days in refiling the appeal is condoned. CM stands disposed of ITA Nos. 41 to 44 of 2008 These appeals under s. 260A of the IT Act (for short the 'Act') have been filed by the Revenue against the orders passed by the Tribunal, New Delhi, whereby it has been held that the interest on enhanced compensation is taxable when the issue relating to enhanced compensation attains its finality as the same would accrue to the assessee at that time only.
(2.) THE brief facts of the case are that the assessee had received an enhanced compensation and interest on enhanced compensation during the year under consideration. The assessee filed return of income and showed interest income on accrual basis from year to year. The AO held that the income from interest received by the assessee has to be assessed in the year of its receipt. these appeals with the following observations : "Keeping in view the above facts and circumstances of the case it is held that the AO was correct in bringing to tax the interest received by the appellant from HUDA on receipt basis. The Hon'ble Supreme Court in the case of Bikram Singh and Ors. has undoubtedly held that the appellant may spread his income over the years. But, that is applicable to the facts of the case before the Hon'ble Supreme Court. The Hon'ble apex Court has not held that in each and every case the appellant shall be entitled to spread its income. Each case has to be viewed with its own peculiarities. In this case, no books of account have been maintained. No returns have been filed for the earlier years to declare interest income. There was indeed no parameter or yardstick which could point out to the accrual of income in the form of interest, year to year, as the quantum on which the interest was to be calculated as also the period for which interest was to be calculated was itself fluid. The action of the AO therefore, bringing to tax the interest on receipt basis is upheld and confirmed."
(3.) Aggrieved against this order, the assessee preferred an appeal before the Tribunal. The Tribunal following the order of the Special Bench of the Tribunal in the case of Dy. CIT vs. Padam Prakash (HUF) (2006) 104 TTJ (Del)(SB) 989 decided the issue in favour of the assessee with the following observations : "We have perused the records and considered the matter carefully. There is no dispute that the entire enhanced compensation is pending in dispute before the High Court. The Special Bench of the Tribunal in case of Padam Parkash, HUF (supra) has held that in case the interest payable on enhanced compensation is pending in dispute before Court, the interest would not accrue and could be subject to tax only when the enhanced compensation is finally determined. Respectfully following the said decision, we reverse the order of CIT(A) and allow the claim of the assessee." ;