Kerala High Court
Commissioner Of Income Tax (Tds) vs Mackar Kunju on 8 July, 2021
"C.R."
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE S.V.BHATTI
&
THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS
THURSDAY, THE 8TH DAY OF JULY 2021 / 17TH ASHADHA, 1943
WA NO. 1250 OF 2014
AGAINST THE JUDGMENT IN WPC 12208/2014 OF HIGH COURT OF KERALA,
ERNAKULAM
APPELLANT/ 4TH RESPONDENT :
COMMISSIONER OF INCOME TAX (TDS),
OFFICE OF THE COMMISSIONER OF INCOME TAX,
KOCHI C.R.BUILDING, I.S. PRESS ROAD,
KOCHI - 682 018.
BY ADVS.
SRI.P.K.R.MENON, SR.COUNSEL, GOI(TAXES)
SRI.JOSE JOSEPH, SC, FOR INCOME TAX
RESPONDENTS/ PETITIONERS/ RESPONDENTS 1 TO 3 :
1 MACKAR KUNJU,
AGED 62 YEARS,
S/O.AIMULLA, MOONNEPILLYPARAMBIL, ANAKKATTU
CHENNAMBILLIL HOUSE, MUTTAM,
THAIKKATTUKARA P.O., ALUVA WEST VILLAGE,
ALUVA TALUK.
2 MAJEED,
AGED 62 YEARS,
S/O.AIMULLA, MOONNEPILLYPARAMBIL,
ANAKKATTU CHENNAMBILLIL HOUSE, MUTTAM,
THAIKKATTUKARA P.O., ALUVA WEST VILLAGE,
ALUVA TALUK.
3 THE DISTRICT COLLECTOR,
ERNAKULAM COLLECTORATE, CIVIL STATION,
KAKKANAD, PIN - 682 030.
WA NO. 1250 OF 2014 & connected cases
2
4 SPECIAL TAHSILDAR (L.A.),
NO.1, KOCHI RAIL PROJECT, CIVIL STATION,
KAKKANAD, PIN - 682 030.
5 KOCHI METRO RAIL CORPORATION,
REP. BY ITS MANAGING DIRECTOR,
VYTTILA, ERNAKULAM, PIN - 682 019.
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 08.07.2021,
ALONG WITH W.A. Nos.1295/2014, 1296/2014, 1538/2014, 1539/2014,
1728/2014, 1729/2014, 1818/2014, 1819/2014 & 170/2015, THE COURT
ON THE SAME DAY DELIVERED THE FOLLOWING:
WA NO. 1250 OF 2014 & connected cases
3
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE S.V.BHATTI
&
THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS
THURSDAY, THE 8TH DAY OF JULY 2021 / 17TH ASHADHA, 1943
WA NO. 1295 OF 2014
AGAINST THE JUDGMENT IN WP(C) No.11943/2014 OF HIGH COURT OF
KERALA, ERNAKULAM
APPELLANT/ 4th RESPONDENT:
COMMISSIONER OF INCOME TAX (TDS)
OFFICE OF THE COMMISSIONER OF INCOME TAX,
KOCHI C.R.BUILDINGS, I.S.PRESS ROAD,
KOCHI - 682 018.
BY ADVS.
SRI.P.K.R.MENON, SR.COUNSEL, GOI(TAXES)
SRI.JOSE JOSEPH, SC, FOR INCOME TAX
RESPONDENTS/PETITIONERS/RESPONDENTS 1 TO 3:
1 ABDUL KHADER
AGED 64 YEARS, S/O.MEETHEEN,
MEETHARAKKAL HOSUE,
CHAMPIARATH, THAIKKATTUKARA,
ALUVA WEST VILLAGE, ALUVA TALUK,
ERNAKULAM.
2 JAMEELA,
AGED 58 YEARS, W/O.ABDUL KHADER,
MEETHARAKKAL HOUSE, CHAMPIARATH,
THAIKATTUKARA, ALUVA WEST VILLAGE,
ALUVA TALUK, ERNAKULAM.
3 THE DISTRICT COLLECTOR
WA NO. 1250 OF 2014 & connected cases
4
ERNAKULAM COLLECTORATE, CIVIL STATION,
KAKKANAD, PIN - 682 030.
4 SPECIAL TAHSILDAR (L.A.)NO.1,
KOCHI RAIL PROJECT, CIVIL STATION,
KAKKANAD, PIN - 682 030.
5 KOCHI METRO RAIL CORPORATION,
REPRESENTED BY ITS MANAGING DIRECTOR,
VYTTILA, ERNAKULAM, PIN - 682 019.
BY ADVS.
SRI.T.B.HOOD
SMT.M.ISHA
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 08.07.2021,
ALONG WITH WA.1250/2014 AND CONNECTED CASES, THE COURT ON THE
SAME DAY DELIVERED THE FOLLOWING:
WA NO. 1250 OF 2014 & connected cases
5
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE S.V.BHATTI
&
THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS
THURSDAY, THE 8TH DAY OF JULY 2021 / 17TH ASHADHA, 1943
WA NO. 1296 OF 2014
AGAINST THE JUDGMENT IN WP(C) No.12206/2014 OF HIGH COURT OF
KERALA, ERNAKULAM
APPELLANT/4TH RESPONDENT:
COMMISSIONER OF INCOME TAX (TDS),
OFFICE OF THE COMMISSIONER OF INCOME TAX,
KOCHI C.R.BUILDINGS, I.S.PRESS ROAD,
KOCHI - 682 018.
BY ADVS.
SRI.P.K.R.MENON, SR.COUNSEL, GOI(TAXES)
SRI.JOSE JOSEPH, SC, FOR INCOME TAX
RESPONDENTS/PETITIONERS/RESPONDENTS 1 TO 3:
1. AMINA, AGED 58 YEARS, W/O.VEERAKUTTY,
CHENNAMBIULLIL HOUSE,
MUTTOM, THAIKKATTUKARA P.O.,
1.
ALUVA WEST VILLAGE, ALUVA TALUK
2. ABDUL RAHMAN,
AGED 46 YEARS, S/O.ABDUL KHADER
PEEDIKAPARAMBIL HOUSE,
MUTTOM, THAIKKATTUKARA P.O.
WA NO. 1250 OF 2014 & connected cases
6
ALUVA WEST VILLAGE, ALUVA TALUK,
3. BIJUTHA BEEVI,
AGED 41 YEARS, W/O.ABDUL REHMAN,
PEEDIKAPARAMBIL HOUSE,
MUTTOM, THAIKKATTUKARA P.O.,
ALUVA WEST VILLAGE, ALUVA TALUK
4. THE DISTRICT COLLECTOR,
ERNAKULAM COLLECTORATE, CIVIL STATION,
KAKKANAD, PIN - 682 030.
5. SPECIAL TAHSILDAR (L.A.)NO.1
KOCHI RAIL PROJECT, CIVIL STATION,
KAKKANAD, PIN - 682 030.
6. KOCHI METRO RAIL CORPORATION
REPRESENTED BY ITS MANAGING DIRECTOR,
VYTTILA, ERNAKULAM, PIN - 682 019.
BY ADVS.
SRI.T.B.HOOD
SMT.M.ISHA
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 08.07.2021,
ALONG WITH WA.1250/2014 AND CONNECTED CASES, THE COURT ON THE
SAME DAY DELIVERED THE FOLLOWING:
WA NO. 1250 OF 2014 & connected cases
7
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE S.V.BHATTI
&
THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS
THURSDAY, THE 8TH DAY OF JULY 2021 / 17TH ASHADHA, 1943
WA NO. 1538 OF 2014
AGAINST THE JUDGMENT IN WP(C) No.12209/2014 OF HIGH COURT OF
KERALA, ERNAKULAM
APPELLANT/4TH RESPONDENT:
COMMISSIONER OF INCOME TAX (TDS)
OFFICE OF THE COMMISSIONER OF INCOME TAX,
KOCHI C.R.BUILDINGS, I.S PRESS ROAD,
KOCHI - 682 018.
BY ADV SRI.JOSE JOSEPH, SC, FOR INCOME TAX
RESPONDENTS/PETITIONERS/RESPONDENTS 1 TO 3:
1 ABOOBACKER,
AGED 52 YEARS, C/O. KOCHUNNI,
CHENNAMBILLIL HOUSE,
MUTTOM, THAIKKATUKARA P.O., ALUVA WEST VILLAGE,
ALUVA TALUK - 683 106.
2 SAKEER,
AGED 52 YEARS, S/O. KOCHUNNI,
CHENNAMBILLIL HOUSE
MUTTOM, THAIKKATTUKARA P.O., ALUVA WEST VILLAGE,
WA NO. 1250 OF 2014 & connected cases
8
ALUVA TALUK - 683 106.
3 THE DISTRICT COLLECTOR,
ERNAKULAM COLLECTORATE, CIVIL STATION,
KAKKANAD - 682 030.
4 SPECIAL TAHSILDAR (L.A)NO.1,
KOCHI RAIL PROJECT, CIVIL STATION,
KAKKANAD - 682 030.
5 KOCHI METRO RAIL CORPORATION,
REP. BY ITS MANAGING DIRECTOR, VYTTILA,
ERNAKULAM - 682 019.
BY ADVS.
SRI.T.B.HOOD
SMT.M.ISHA
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 08.07.2021,
ALONG WITH WA.1250/2014 AND CONNECTED CASES, THE COURT ON THE
SAME DAY DELIVERED THE FOLLOWING:
WA NO. 1250 OF 2014 & connected cases
9
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE S.V.BHATTI
&
THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS
THURSDAY, THE 8TH DAY OF JULY 2021 / 17TH ASHADHA, 1943
WA NO. 1539 OF 2014
AGAINST THE JUDGMENT IN WP(C) NO.9236/2014 OF HIGH COURT OF
KERALA, ERNAKULAM
APPELLANT/4TH RESPONDENT:
COMMISSIONER OF INCOME TAX (TDS)
OFFICE OF THE COMMISSIONER OF INCOME TAX,
KOCHI C.R. BUILDINGS, I.S PRESS ROAD,
KOCHI - 682018.
BY ADV SRI.JOSE JOSEPH, SC, FOR INCOME TAX
RESPONDENTS/PETITIONERS/RESPONDENTS 1 TO 3:
1 V.S. LALAN
AGED 55 YEARS, S/O. VELIYIL SANKUNNY,
SRUTHINIDHILAYAMN,
NEAR MEDICAL CENTRE HOSPITAL, PALARIVATTOM,
ERNAKULAM. 682 025
2 K.H.JAYAPRAKASH
AGED 52 YEARS, S/O. HARI SHENOY,
G-3, KENT PARADISE,
MAYFEST ROAD, THAMMANAM P.O. 682 032
WA NO. 1250 OF 2014 & connected cases
10
3 THE DISTRICT COLLECTOR
ERNAKULAM COLLECTORATE, CIVIL STATION,
KAKKANAD - 682 030.
4 SPECIAL TAHSILDAR (LA) NO.1,
KOCHI RAIL PROJECT, CIVIL STATION,
KAKKANAD - 682 030.
5 KOCHI METRO RAIL CORPORATION
REP. BY ITS MANAGING DIRECTOR,
VYTTILA, ERNAKULAM - 682 019.
BY ADV SRI.K.R.VINOD
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 08.07.2021,
ALONG WITH WA.1250/2014 AND CONNECTED CASES, THE COURT ON THE
SAME DAY DELIVERED THE FOLLOWING:
WA NO. 1250 OF 2014 & connected cases
11
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE S.V.BHATTI
&
THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS
THURSDAY, THE 8TH DAY OF JULY 2021 / 17TH ASHADHA, 1943
WA NO. 1728 OF 2014
AGAINST THE JUDGMENT IN WP(C) NO.9231/2014 OF HIGH COURT OF
KERALA, ERNAKULAM
APPELLANT/4TH RESPONDENT:
COMMISSIONER OF INCOME TAX (TDS),
OFFICE OF THE COMMISSIONER OF INCOME TAX,
KOCHI C.R. BUILDINGS, I.S.PRESS ROAD,
KOCHI - 682 018.
BY ADV SRI.JOSE JOSEPH, SC, FOR INCOME TAX
RESPONDENTS/PETITIONERS/RESPONDENTS 1 TO 3:
1 M.D. JOSE
AGED 62 YEARS, S/O.DEVASSY,
MALIYEKAL HOUE,
BEENA-ANCHUMANA ROAD, EDAPPALLY ROAD,
KOCHI-24.
2 THE DISTRICT COLLECTOR
ERNAKULAM COLLECTORATE, CIVIL STATION,
KAKKANAD, PIN - 682 030.
3 SPECIAL TAHASILDAR (L.A) NO.1
WA NO. 1250 OF 2014 & connected cases
12
KOCHI RAIL PROJECT, CIVIL STATION,
KAKKANAD, PIN - 682 030.
4 KOCHI METRO RAIL CORPORATION
REPRESENTED BY ITS MANAGING DIRECTOR,
VYTTILA, ERNAKULAM, PIN - 682 019.
BY ADVS.
SRI.T.B.HOOD
SMT.M.ISHA
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 08.07.2021,
ALONG WITH WA.1250/2014 AND CONNECTED CASES, THE COURT ON THE
SAME DAY DELIVERED THE FOLLOWING:
WA NO. 1250 OF 2014 & connected cases
13
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE S.V.BHATTI
&
THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS
THURSDAY, THE 8TH DAY OF JULY 2021 / 17TH ASHADHA, 1943
WA NO. 1729 OF 2014
AGAINST THE JUDGMENT IN WP(C) NO.14914/2014 OF HIGH COURT OF
KERALA, ERNAKULAM
APPELLANT/4TH RESPONDENT:
COMMISSIONER OF INCOME TAX (TDS)
OFFICE OF THE COMMISSIONER OF INCOME TAX,
KOCHI, C.R.BUILDINGS, I.S.PRESS ROAD,
KOCHI - 682 018.
BY ADV SRI.JOSE JOSEPH, SC, FOR INCOME TAX
RESPONDENTS/PETITIONERS/RESPONDENTS:
4
1. P.S. ABDUL RAHIMAN
AGED 65 YEARS, S/O SAYID MOHAMMED
33/124C, MARHABA
SOUMYA NAGAR, VENNALA
ERNAKULAM
2. THE DISTRICT COLLECTOR
COLLECTORATE, CIVIL STATION,
KAKKANAD, ERNAKULAM - 682 030.
3. THE SPECIAL TAHSILDAR (LAND ACQUISITION)
WA NO. 1250 OF 2014 & connected cases
14
NATIONAL HIGHWAY NO.3, VYTILLA,
ERNAKULAM- 682 019.
4. KOCHI METRORAIL CORPORATION
BY MANAGING DIRECTOR, VYTILLA,
ERNAKULAM - 682 019.
BY ADVS.
SRI.T.B.HOOD
SMT.M.ISHA
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 08.07.2021,
ALONG WITH WA.1250/2014 AND CONNECTED CASES, THE COURT ON THE
SAME DAY DELIVERED THE FOLLOWING:
WA NO. 1250 OF 2014 & connected cases
15
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE S.V.BHATTI
&
THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS
THURSDAY, THE 8TH DAY OF JULY 2021 / 17TH ASHADHA, 1943
WA NO. 1818 OF 2014
AGAINST THE JUDGMENT IN WP(C) NO.9056/2014 OF HIGH COURT OF
KERALA, ERNAKULAM
APPELLANT/4TH RESPONDENT:
COMMISSIONER OF INCOME TAX (TDS)
OFFICE OF THE COMMISSIONER OF INCOME TAX,
KOCHI C.R.BUILDINGS, I.S.PRESS ROAD,
KOCHI - 682 018.
BY ADVS.
SRI.P.K.R.MENON,SR.COUNSEL, GOI(TAXES)
SRI.JOSE JOSEPH, SC, FOR INCOME TAX
RESPONDENTS/PETITIONERS/RESPONDENTS 1 TO 3:
1 PAULSON PAULOSE
AGED 38 YEARS, S/O.PAULOSE,
RESIDING AT CHAKYATH HOUSE,
CHERANALLORE P.O., KOCHI - 682 024.
2 THE DISTRICT COLLECTOR
ERNAKULAM COLLECTORATE CIVIL STATION,
KAKKANAD, PIN - 682 030.
3 SPECIAL TAHASILDAR (L.A.) NO.1
WA NO. 1250 OF 2014 & connected cases
16
KOCHI RAIL PROJECT, CIVIL STATION,
KAKKANAD, PIN - 682 030.
4 KOCHI METRO RAIL CORPORATION
REPRESENTED BY ITS MANAGING DIRECTOR,
VYTTILA, ERNAKULAM, PIN - 682 019.
BY ADV SELMA JANNATH FOR R1
BY SRI.R.SANJITH
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 08.07.2021,
ALONG WITH WA.1250/2014 AND CONNECTED CASES, THE COURT ON THE
SAME DAY DELIVERED THE FOLLOWING:
WA NO. 1250 OF 2014 & connected cases
17
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE S.V.BHATTI
&
THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS
THURSDAY, THE 8TH DAY OF JULY 2021 / 17TH ASHADHA, 1943
WA NO. 1819 OF 2014
AGAINST THE JUDGMENT IN WP(C) NO.4209/2014 OF HIGH COURT OF
KERALA, ERNAKULAM
APPELLANT/4TH RESPONDENT::
COMMISSIONER OF INCOME TAX (TDS)
OFFICE OF THE COMMISSIONER OF INCOME TAX,
KOCHI C.R. BUILDINGS, I.S.PRESS ROAD,
KOCHI 682 018
BY ADV SRI.JOSE JOSEPH, SC, FOR INCOME TAX
RESPONDENTS/PETITIONERS/RESPONDENTS 1 TO 3:
1 JOSE P.SIMON
AGED 52 YEARS, S/O.SIMON,
POWATH HOUSE,
KUMARAKOM P.O,
KOTTAYAM DISTRICT, PIN-686 563
2 DAISY SIMON
AGED 47 YEARS, W/O.JOSE SIMON,
KUMARAKOM P.O,
KOTTAYAM DISTRICT, PIN-686 563.
WA NO. 1250 OF 2014 & connected cases
18
3 JOSE M.D.
AGED 62 YEARS, S/O.DEVASSY,
MALIYEKAL HOUSE,
BEENA-ANCHUMANA ROAD, EDAPPALLY ROAD,
KOCHI-682 024
4 THE DISTRICT COLLECTOR
ERNAKULAM COLLECTORATE, CIVIL STATION,
KAKKANAD, PIN- 682 030
5 SPECIAL TAHSILDAR (L.A.) NO.1
KOCHI RAIL PROJECT, CIVIL STATION,
KAKKANAD, PIN-682030
6 KOCHI METRO RAIL CORPORATION
REP.BY ITS MANAGING DIRECTOR, VYTTILA,
ERNAKULAM, PIN 682019
BY ADVS.
MS.JENCY SUSAN JOSE
SMT.M.S.LETHA
SRI.V.SRI NATH
SRI.K.R.VINOD
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 08.07.2021,
ALONG WITH WA.1250/2014 AND CONNECTED CASES, THE COURT ON THE
SAME DAY DELIVERED THE FOLLOWING:
WA NO. 1250 OF 2014 & connected cases
19
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE S.V.BHATTI
&
THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS
THURSDAY, THE 8TH DAY OF JULY 2021 / 17TH ASHADHA, 1943
WA NO. 170 OF 2015
AGAINST THE JUDGMENT IN WP(C) NO.12207/2014 OF HIGH COURT OF
KERALA, ERNAKULAM
APPELLANT/4TH RESPONDENT::
COMMISSIONER OF INCOME TAX (TDS),
OFFICE OF THE COMMISSIONER OF INCOME TAX
KOCHI C.R. BUILDINGS, I.S.PRESS ROAD,
KOCHI 682 018
BY ADVS.
SRI.P.K.R.MENON,SR.COUNSEL, GOI(TAXES)
SRI.JOSE JOSEPH, SC, FOR INCOME TAX
RESPONDENTS/PETITIONERS/RESPONDENTS 1 TO 3:
1. AHEMMED
AGED 62 YEARS, S/O KUNJAMMU
CHENNAMBILLIL HOUSE
KARIMBIN PURAYIDATHIL, CHOORNIKKARA KARA
THAIKKATTUKARA P.O.
WA NO. 1250 OF 2014 & connected cases
20
ALUVA WEST VILLAGE, ALUVA TALUK 683 106
2. THE DISTRICT COLLECTOR
ERNAKULAM COLLECTORATE, CIVIL STATION,
KAKKANAD, ERNAKULAM - 682 030.
3. SPECIAL TAHSILDAR (LA) NO.1
KOCHI RAIL PROJECT, CIVIL STATION
KAKKANAD PIN 682 030
4. KOCHI METRORAIL CORPORATION
REP. BY ITS MANAGING DIRECTOR, VYTILLA,
ERNAKULAM - 682 019.
BY ADVS.
SRI.T.B.HOOD
SMT.M.ISHA
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 08.07.2021,
ALONG WITH WA.1250/2014 AND CONNECTED CASES, THE COURT ON THE
SAME DAY DELIVERED THE FOLLOWING:
WA NO. 1250 OF 2014 & connected cases
21
C.R.
JUDGMENT
[WA Nos.1250/2014, 1295/2014, 1296/2014, 1538/2014, 1539/2014,
1728/2014, 1729/2014, 1818/2014, 1819/2014 & 170/2015]
Dated this the 8th day of July,2021
Bechu Kurian Thomas, J.
The issue that arises for consideration in this batch of writ
appeals relate to the question whether tax is liable to be deducted at
source for amounts paid as compensation arrived at under negotiated
settlements during acquisition of property. The learned Single Judge
held that tax cannot be deducted at source under Section 194LA of the
Income Tax Act, 1963 (for short, 'the Act') in respect of compensation
paid to the land owners which was arrived at based on negotiated
settlements.
2. The above question springs from proceedings for
acquisition of land initiated under Section 11 of the Land Acquisition
Act, 1894 (for short, 'the LA Act') for implementing the Kochi Metro
Rail Project. After proceedings were initiated for the acquisition of
property under the L.A.Act, negotiations were held and settlements
WA NO. 1250 OF 2014 & connected cases
were arrived at with the respective land owners by the District Level
Purchase Committee. In effect consent awards were passed by the
District Collector under Section 11(2) of the LA Act, pursuant to the
agreement between the parties on the price payable for the land
acquired as compensation. The writ petition was filed contending that
the lands having been purchased by the Government, on the basis of
negotiated settlements, there is no compulsory acquisition and hence
Section 194LA of the Act was not applicable. Reliance was placed on
the decisions reported in Info Park Kerala v. Asst. Commissioner
of Income Tax [2008 (4) KLT 782] as well as in Thomas v. District
Collector [2013 (3) KLT 941].
3. The learned Single Judge upheld the claim of the writ
petitioners and allowed the writ petitions by restraining the revenue
officials from deducting any tax at source under Section 194LA of the
Act, in respect of the compensation paid to the writ petitioners.
4. The learned counsel for the appellant at the threshold
submitted that the issue involved in these appeals was considered by
the Supreme Court in the decision reported in Balakrishnan v. Union
of India and Others [(2017) 3 SCC 634] and held in favour of the
appellants.
WA NO. 1250 OF 2014 & connected cases
5. Before we consider the aforesaid submission of the
learned counsel for the appellant, we wish to mention that the
impugned judgment was rendered on 03.06.2014 and even though the
appeal was admitted in 2014, there was no stay of operation of the
judgment and accordingly the compensation amounts would have
already been disbursed to the writ petitioners, in tune with the
impugned judgment.
6. Be that as it may, Section 194LA was inserted in the
statute book by Finance Act 2004 With effect from 01-10-2004. The
section reads as below:
S.194LA. Payment of compensation on acquisition of
certain immovable property:-
Any person responsible for paying to a resident any sum, being
in the nature of compensation or the enhanced compensation or the
consideration or the enhanced consideration on account of compulsory
acquisition, under any law for the time being in force, of any
immovable property (other than agricultural land), shall, at the time of
payment of such sum in cash or by issue of a cheque or draft or by any
other mode, whichever is earlier, deduct an amount equal to ten
percent of such sum as income-tax thereon.
Provided that no deduction shall be made under this section
where the amount of such payment or, as the case may be, the
aggregate amount of such payments to a resident during the financial
year does not exceed two lakh and fifty thousand rupees:
Provided further that no deduction shall be made under this
section where such payment is made in respect of any award or
agreement which has been exempted from levy of income-tax under
section 96 of the Right to Fair Compensation and Transparency in Land
Acquisition, Rehabilitation and Resettlement Act, 2013 (30 of 2013).
WA NO. 1250 OF 2014 & connected cases
Explanation-For the purposes of this section,-
(i) "agricultural land" means agricultural land in India including land
situate in any area referred to in items (a) and (b) of sub-clause (iii) of
clause (14) of section 2;
(ii) "immovable property" means any land (other than agricultural
land) or any building or part of a building.
7. A reading of the above section clearly shows that when
compensation or consideration, as the case may be, for compulsory
acquisition of any immovable property other than agricultural land
becomes payable, the person responsible for paying such
compensation or consideration shall be bound to deduct ten percent of
such sum as income tax at the time of payment. The proviso to the
section, as it then stood, further stipulated that the deduction need not
be made, if the aggregate amount of such payment to the person
during a financial year, does not exceed two hundred thousand rupees.
It is obvious that the emphasis in the section is on the words
'compulsory acquisition'. If the nature of acquisition is compulsory,
then, irrespective of whether the amounts are paid as compensation or
as consideration, the deduction becomes mandatory, provided the
other conditions are applicable.
8. Acquisition of property becomes compulsory in nature
whenever and wherever property is obtained by the government,
WA NO. 1250 OF 2014 & connected cases
pursuant to proceedings initiated for land acquisition under the
relevant land acquisition laws. Negotiated settlements arrived at with
government or governmental bodies for transfer of property, after
proceedings for acquisition have been initiated remain in the realm of
compulsory acquisition. The decision to part with the property, which
is the subject matter of a negotiated settlement, does not originate
from any exercise of a free mind of the owner of the property. It
stems from the compulsion imposed by proceedings for acquisition.
The transfer of property remains in the nature of compulsory
acquisition.
9. The learned Single Judge relied upon a decision of the
Division Bench of this Court in WA 2243 of 2008. We are afraid that
the said decision no longer holds the field in view of the decision of the
Supreme Court in Balakrishnan v. Union of India and others
(2017) 3 SCC 634. In the said decision it was held that a land owner
would have been compelled to divest himself of his land because of the
compulsory acquisition and to avoid possible litigations, he would have
entered into negotiation and settlement. The court also observed that,
merely because the compensation amount payable for the land is
agreed upon between the parties, the same will not change the
WA NO. 1250 OF 2014 & connected cases
character of the acquisition from that of compulsory acquisition to a
voluntary sale. The decision which was relied upon by the learned
Single Judge i.e. Info Park v. Asst. Commissioner of Income Tax
[2008 (4) KLT 782] was overruled by the Supreme Court in the
aforesaid case.
10. For a better comprehension the observations of
the Supreme Court in Balakrishnan's case (supra) are extracted
as below :
7. It is in the aforesaid factual backdrop, this Court is to
determine as to whether it can be treated that the land of the
appellant was compulsorily acquired. From the facts mentioned
above, it becomes apparent that the acquisition process was
initiated by invoking the provisions of the LA Act by the State
Government. For this purpose, not only Notification under
Section 4 was issued, it was followed by declaration under
Section 6 and even award under Section 9 of the LA Act. With
the award, the acquisition under the LA Act was completed.
Only thing that remains thereafter was to pay the compensation
as fixed under the award and take possession of the land in
question from the appellant. No doubt, in case, the
compensation as fixed by the Land Acquisition Collector was not
acceptable to the appellant, the LA Act provides for making a
reference under Section 18 of the Act to the District Judge for
determining the compensation and to decide as to whether the
compensation fixed by the Land Acquisition Collector was proper
or not. However, the matter thereafter is only for quantum of
WA NO. 1250 OF 2014 & connected cases
compensation which has nothing to do with the acquisition. It is
clear from the above that insofar as acquisition is concerned, the
appellant had succumbed to the action taken by the Government
in this behalf. His only objection was to the market value of the
land that was fixed as above. To reiterate his grievance, the
appellant could have either taken the aforesaid adjudicatory
route of seeking reference under Section 18 of the LA Act
leaving it to the Court to determine the market value. Instead
the appellant negotiated with Techno Park and arrived at
amicable settlement by agreeing to receive the compensation in
the sum of Rs.38,42,489. For this purpose, after entering into
the agreement the appellant agreed to execute the sale deed as
well which was a necessary consequence and a step which the
appellant had to take.
8. In our view, insofar as acquisition of the land is
concerned, the same was compulsorily acquired as the entire
procedure under the LA Act was followed. The settlement took
place only qua the amount of the compensation which was to be
received by the appellant for the land which had been acquired.
It goes without saying that had steps not been taken by the
Government under Sections 4 and 6 followed by award under
Section 9 of the LA Act, the appellant would not have agreed to
divest the land belonging to him to Techno Park. He was
compelled to do so because of the compulsory acquisition and to
avoid litigation entered into negotiations and settled the final
compensation. Merely because the compensation amount is
agreed upon would not change the character of acquisition from
that of compulsory acquisition to the voluntary sale. It may be
mentioned that this is now the procedure which is laid down
WA NO. 1250 OF 2014 & connected cases
even under the Right to Fair Compensation and Transparency in
Land Acquisition, Rehabilitation and Resettlement Act, 2013 as
per which the Collector can pass rehabilitation and resettlement
award with the consent of the parties/landowners. Nonetheless,
the character of acquisition remains compulsory.
11. Thus it is ineludible that once the proceedings
for acquisition are initiated under law, whatever be the nature
of payment, whether as compensation for acquisition or as
consideration for a negotiated settlement, the character of the
acquisition remains compulsory in nature and hence Section 194LA
of the Act will apply. The judgement in Balakrishnans' case clearly
covers situations of this nature. In the above circumstances, the
judgment of the learned Single Judge is liable to be set aside. We
do so, in all these appeals.
12. As observed by us earlier, after the impugned
judgment there was no stay of operation of the judgment and
the compensation or consideration as the case may be would have
been paid without deducting the TDS. We clarify that in cases where
TDS was deducted before payment of consideration, the same is
liable to be made over to the Income Tax Department. In cases where
the consideration was paid without deduction of tax as per the
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judgment, it is needless to state that the judgment had worked itself
out.
With the above observations these appeals are disposed of.
Sd/-
S.V.BHATTI, JUDGE
Sd/-
BECHU KURIAN THOMAS, JUDGE
RKM
