Balakrishnan v. Union Of India

JUDGMENT

The issue is covered by Info Park Kerala v. Assistant Commissioner of Income Tax2008 (4) KLT 782 which was affirmed in Writ Appeal No. 2243/2008. Therefore the transaction evidenced by Ext.P4 sale deed after Ext.P2 notification under the Land Acquisition Act 1894 can only be a negotiated sale. It may be true that no deduction under Section 194 LA of the Income Tax Act 1961 need be done since the sale price was fixed by negotiation. But the petitioner cannot escape from the liability to pay income tax under the head ‘capital gains’ in the Income Tax Act 1961. Section 10(37) (iii) of the Income Tax Act 1961 applies only when the transfer is by way of compulsory acquisition in regard to a land being used for agricultural purposes only.

2. The second respondent was therefore right in denying the claim for exemption under Section 10(37) of the Income Tax Act, 1961 by Ext.P8 order.

The Writ Petition fails and is dismissed.