Law:

Section:

Section 293, read with section 4, of the Income-tax Act, 1961 - Bar of suits in civil court - Assessment years 1984-85 to 1987-88 - Whether dispute of partition inter-parties vis-a-vis shares and eligibility/entitlement can more appropriately be adjudicated upon by civil court and not by income-tax authorities and, therefore, decree and order passed by civil court is binding between parties and consequential effect was to be given by income-tax authority while passing assessment order - Held, yes - Assessee's agricultural land was acquired by Development Authority - Assessee received compensation and interest - Assessing authority taxed interest so received in assessee's hand Assessee claimed that only one-fifth share of interest would be taxable in his hand as he had only one-fifth share in said land after family settlement whereby he and his sons acquired one-fifth share each and placed reliance upon order of Civil Judge in declaratory suit in support thereof - Revenue's case was that decree passed by civil court was not binding upon revenue - Whether on facts assessee was to be held taxable in respect of one-fifth share of interest income only - Held, yes FACTS The assessee owned certain agricultural land which was acquired by the Development Authority. The assessee was paid compensation and was also awarded interest under section 34 of the Land Acquisition Act. The Assessing authority taxed the interest so received in the assessee's hand. The assessee claimed that he had only one-fifth share in the said agricultural land after the family settlement in which he and each of his sons was given one-fifth share and that a declaratory suit was also filed by one of his sons in which it was held by the Civil Judge that each one had one-fifth share. The Assessing Officer held that the order of the Civil Judge made in the declaratory suit did not justify the assessee's interest and that of his sons and since the land revenue record showed the assessee as the owner, the interest was assessable in the hands of the assessee. On appeal, the Commissioner (Appeals) upheld the order of the Assessing Officer. On further appeal, the Tribunal upheld the claim of the assessee…

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