COMMISSIONER OF INCOME TAX Vs. SAMPANGIRAMAIAH V

JUDGEMENT

(1.) THE question referred to us under s. 256(1) of the IT Act, 1961, by the Tribunal, at the instance of the CIT, is :

(2.) THIS is how the question arises : By a notification made on January 13, 1948, under s. 4 of the Land Acquisition Act, a land owned by the assessee measuring 20,000 square yards was proposed to be acquired, and on February 19, 1949, possession was taken. The Land Acquisition Officer of the Corporation of the City of Bangalore made an award on June 2, 1949, by which he determined the compensation payable to the assessee to be a sum calculated at Rs. 2 a square yard. He also gave him the usual statutory allowance. THIS sum of money aggregating to Rs. 46,000 was paid to the assessee only on December 31, 1949. But there was a reference to the District Judge under s. 18 of the Land Acquisition Act, and, in that reference, the District Judge enhanced the compensation to a sum calculated at Rs. 5 a square yard. From the decree made by the District Judge in that way, both the assessee and the Land Acquisition Officer appealed to the former High Court of Mysore, which, by a decree made on March 30, 1956, enhanced the compensation to a sum calculated at Rs. 7 a square yard. There was again an appeal to the Supreme Court by both the parties, and those appeals were dismissed by the Supreme Court on March 7, 1961.

(3.) ON behalf of the Department, Mr. Rajasekhara Murthy maintained that the Tribunal missed the true import of the decision of the Supreme Court in Keshav Mills Ltd. vs. CIT (1953) 23 ITR 230 (SC), and E.D. Sassoon and Co. Ltd. vs. CIT (1954) 26 ITR 27 (SC), on which it depended as could be seen from the more recent enunciation in CIT vs. A. Gajapathy Naidu (1964) 53 ITR 114 (SC). The pendency of the appeals before the Supreme Court, it was said, introduced an element of uncertainty as to the compensation really climbable which denuded the High Court decries of the attribute of finality, and the argument was constructed that the right to compensation and the interest thereon did not accrue until there was their quantificationf by the Land Acquisition Officer on the basis of the decisions in those appeals. The proposition that the accrual of that right stood so postponed cannot be sound.