APPROPRIATE AUTHORITY, INCOME TAX DEPARTMENT Vs. R. SHANMUGANATHAN

JUDGEMENT

(1.) Leave granted.

(2.) The only question in these appeals is whether the appellant authority should have been paid the interest on the purchase price which was refunded by the respondents. The issue arose in connection with the compulsory purchase of the respondents' property said to have been effected by the appropriate authority under Chapter XX-C of the Income Tax Act, 1961 .

(3.) The possession was taken by the Department on 17.06.1993. On 17.07.1993 the purchase price was paid by the appellant to the respondent owners. Subsequent to this, the respondents filed a writ petition impugning the purchase order and were successful in obtaining an interim order staying further operation of the purchase order. The writ petition was ultimately allowed by the learned Single Judge who set aside the purchase order and directed that the appellant should return the possession of the premises to the respondent owners who in turn were to return the purchase price together with interest calculated thereon @ 15% per annum.