COMMISSIONER OF WEALTH TAX Vs. LUCY KOCHUVAREED

JUDGEMENT

(1.) ALL these petitions are under Section 27(3) of the Wealth-tax Act, 1957. As they raise certain common questions, they are being heard together. The assessee was the owner of a rubber estate at Trichur known as "Vellanikara Estates" which was acquired by the Government of Kerala under the Kerala Land Acquisition Act for the purpose of the Kerala Agricultural University at Mannuthy near Trichur. The relevant notifications under Section 3(1) of the Kerala Land Acquisition Act were published on September 1, 1970, September 8, 1970, and November 10, 1970. The property was taken possession of on May 1, 1973. An award was passed in respect of the said property on March 15, 1974, under which an amount of Rs. 19,16,385 was awarded as compensation to the assessee. In addition, a sum of Rs. 9,58, 192 was also awarded as compensation to the firm, Messrs. Varkey Jacob and Co., which was the lessee of the estate. The total compensation of Rs. 28,74,577 was divided between the assessee-owner and the lessee company in the ratio of 2:1.

(2.) THE assessee filed reference petitions before the Subordinate Court, Trichur, for enhancement of compensation. Ultimately, the matter was decided by the High Court by its order dated January 28, 1987, in L. A. A. No. 324 of 1977. THE High Court finally determined the enhanced compensation at Rs. 24,03,450. It also awarded interest on the enhanced compensation amount from the date when the property was taken over by the Government.

(3.) FOR the subsequent assessment years, the Tribunal has rightly observed that the sum of Rs. 28,74,577 received by the assessee on June 28, 1974, had already entered the wealth stream and, therefore, what was required to be evaluated for and from the assessment year 1975-76 was only the present value of the enhanced compensation as set out in paragraph GA of the Tribunal's order. The Tribunal in effect, therefore, gave a discount of 25 per cent. only on the enhanced value of compensation for the hazards and uncertainties of litigation for these assessment years. Column 4 in the Table in paragraph 6A read with Note F makes this clear.