DARAPANENI CHENNA KRISHNAYYA Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE brief facts of the case are:

(2.) THE land belonging to the assessee, a Hindu undivided family (HUF), was acquired by the Government of Andhra Pradesh in terms of the provisions of the Land Acquisition Act during 1981 -82. The Land Acquisition Officer awarded compensation at the rate of Rs. 20,000 per acre. Not satisfied with the award, the assessee sought a reference and the civil court enhanced the compensation to Rs. 71,380 per acre. On appeal, the High Court enhanced the compensation to Rs. 2,83,000 per acre. By virtue of the orders of the High Court, the assessee received additional compensation amounting to Rs. 15,26,135 and interest on the additional compensation amounting to Rs. 28,58,622 on April 9, 1991, and on receiving the amounts, he invested the entire additional compensation in the UTI Capital Gains Scheme of 1983, on October 1, 1991, i.e., within six months from the date of receipt of the additional compensation and sought exemption under Section 54E of the Income Tax Act, 1961 (for short "the Act"). The Assessing Officer denied this exemption on the ground that investment in the UTI Capital Gains Scheme, 1983, was not eligible for exemption as the capital gain arose in respect of transfer of the original asset prior to March 31, 1983, when the UIT Capital Gains Scheme, 1983, was not in force. On appeal, the Commissioner of Income Tax (Appeals) upheld the disallowance made by the Assessing Officer. On further appeal, the Tribunal held that the assessee is entitled for the exemption under Section 54E of the Act.

(3.) SIMILARLY , an extent of two acres of land owned by the assessee was acquired by the Government during 1992 -93 and a compensation of Rs. 1,58,710 was paid to the assessee. The assessee claimed to have purchased agricultural land for Rs. 55,855 from out of the compensation amount, and accordingly claimed exemption in respect of the same under Section 54B of the Act. The said claim for exemption has been rejected by the Assessing Officer as well as the Commissioner of Income Tax (Appeals). On further appeal, the Tribunal also confirmed the rejection of the claim of the assessee by the authorities below.