RAMESHWAR S/O DHANNALAL Vs. UJJAIN DEVELOPMENT AUTHORITY

JUDGEMENT

(1.) Being aggrieved by the order dated 27.11.2010 passed by 9th Addl. District Judge, Ujjain in execution cases filed by the petitioners for recovery of compensation awarded in Land Acquisition cases, present petitions have been filed. Short facts of the case are that in all the petitions, execution cases were filed by the petitioners, wherein prayer was that respondent No. 1 be directed to pay compensation along with interest and other benefits. Respondent No. 1 deposited the amount payable to the petitioners and submitted that as per section 194-LA of the Income-tax Act a sum of Rs. 34,95,833/- has been deposited by the respondent No. 1 in all the execution petitions on 10.6.2009 with the Income-tax Department. It is submitted that thus the execution petitions be dismissed in full satisfaction. After hearing the parties learned Court below dismissed the execution petitions in full satisfaction against which present petitions have been filed.

(2.) Shri A.S. Kutumbale, learned senior counsel appearing on behalf of the petitioners in all the petitions, submits that impugned order passed by the learned Court below is illegal, incorrect and deserves to be set aside. Learned counsel submits that no amount could have been deducted by the respondent No. 1 on account of TDS. It is submitted that Section 194-LA has been amended vide amendment Act No. 2 of 2004 w.e.f. 1.10.2004, which reads as under:-

(3.) Learned counsel submits that since the property, which was acquired by respondents No. 2 and 3 at the instance of respondent No. 1, was the agricultural land, therefore, respondent No. 1 was having no authority to deduct the TDS. Learned counsel placed reliance on a decision in the matter of Mysore Urban Development Authority v. ITO, 2008 175 Taxman 307 wherein Karnataka High Court had an occasion to consider the word "agricultural land" within the meaning of Section 194LA and has observed that in a case of compensation for acquisition of agricultural land main part of Section 194LA itself excludes agricultural land from the immovable property covered by Sec. 194LA as the words in the brackets i.e. 'other than agricultural land' indicate that there is no obligation cast on a person to deduct tax while distributing compensation for agricultural land located at any place including in an urban agglomeration. Learned counsel further placed reliance in the matter of Risal Singh v. Union of India, 2010 321 ITR 251. Learned counsel submits that learned executing Court committed error in observing that since respondent No. 1 has deposited entire amount of compensation after deducting TDS and is also ready to give certificate of it so that petitioners can take it back from Income-tax Department, hence the proceedings stands dropped in full satisfaction. Learned counsel submits that while making this observation learned Court below has completely overlooked the provisions of Section 194LA of the Income-tax Act, which excludes the deduction of TDS on agricultural land. It is submitted that petitions be allowed and impugned order be set aside.