Law:

Section:

Income-tax----Assessee dealing in land--Land compulsorily requisitioned by Government--- Assessee being dissatisfied by the compensation awarded by Collector claimed additional amount of compensation--Assessee awarded by Arbitrator enhanced amount with interest--Appeal by Government against award of the Arbitrator--Government deposited amount in Court during pendency of such appeal and assessee was permitted, to withdraw said amount from Court--Amount of additional compensation could not be treated as income arising or accruing to assessee during the previous year--Such amount cannot be treated as a taxable income in the relevant assessment year-Held, it was on the final determination of the amount of compensation that the right to such income in the nature of compensation would arise or accrue, and till then there was no liability in praesenti in respect of the additional amount of compensation claimed by land owner. JUDGMENT R.S. PATHAK,. J.--This appeal. by certificate granted by the High Court is directed against the judgment of the Calcutta High Court answering the following question in the negative:- "Whether, on the facts and in the circumstances of the case, the extra amount of compensation amounting to Rs.7,24,914 was income arising or accruing to the assessee during the previous year relevant to the assessment year 1956-57?" The assessee; who is respondent before us, is a limited company dealing in land. It maintains its accounts on the mercantile system. By an order dated June 21, 1946, under rule 75A (1) of the Defence of India Rules read with Section 19 of the Defence of India Act, 1939, certain plots of land measuring about 19.17 acres in village Kankulia in the District of 24 Parganas and belonging to the assessee, were requisitioned by the Government of West Bengal. Subsequently the land was acquired permanently by the State Government under section 5, Requisition of Land (Continuance of Powers) Act, 1951, by a notice of acquisition dated December 27, 1952, published in the Gazette dated January 8, 1953. The Land Acquisition officer, awarded a sum of Rs.24,97,294 as compensation payable to the assessee. The assessee was not satisfied with the…

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