Smt. Grandhi Ramalakshmi V. The Union of India

WP/5069/2021

AI Insights

The case involves a writ petition filed under Article 226 of the Constitution of India, challenging the deduction of T.D.S. from compensation awarded for land acquisition. The petitioner owned agricultural land that was acquired, and a portion of the compensation was deducted as T.D.S. The petitioner argued that this deduction was illegal and sought a mandamus to return the deducted amount. The Income Tax Department countered that T.D.S. was correctly deducted as per the provisions applicable to non-agricultural lands, but acknowledged the lands in question were agricultural. The court did not directly address the legality of the T.D.S. deduction but suggested the petitioner could seek a refund through her income tax return for the relevant assessment year.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 735039 (HC-ANDHRA_PRADESH)
• Appeal Type: Others
• Pronouncement Date: 25-08-2022
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961, Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, Constitution of India
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: N HARINATH; M KIRANMAYEE; LAXMINARAYANA ALISHETTY; GOVERNMENT PLEADER FOR LAND ACQUISITION
• Assessee Lawyers: K SRINIVASA RAO
• Keywords: Agricultural Land; Illegal Deduction; Land acquisition compensation; Mandamus; T.D.S deduction
• Section: 14; 96; 21; 105(3); 300A; 194-LA

Judgement Text

"THE HONOURABLE SRI JUSTICE C.PRAVEEN KUMAR AND THE HONOURABLE SRI JUSTICE A.V.RAVINDRA BABU WRIT PETITION No.5069 of 2021 ORDER:- (Per Hon’ble Sri Justice C.Praveen Kumar) Heard Sri K. Srinivasa Rao, learned counsel representing Sri P.A.K. Kishore, learned counsel for the petitioner, Sri N.Harinath, learned Assistant Solicitor General appearing for respondent Nos.1 and 2, Smt M. Kiranmayee, learned Standing Counsel for Income Tax appearing for respondent No.3, Sri Laxminarayana Alishetty, learned Standing Counsel for National Highways Authority of India appearing for respondent Nos.4 and 6, and learned Government Pleader for Land Acquisition appearing for respondent Nos.7 and 8. 2. The present Writ Petition came to be filed under Article 226 of the Constitution of India seeking the following relief:- “…… to issue an appropriate writ or order or direction more particularly one in the nature of mandamus declaring: a) The act of the 7th Respondent in deducting an amount of Rs.22,06,350/- by way of cheque bearing No.001785 towards T.D.S from the 60% of compensation amount awarded to the petitioner, is illegal, arbitrary, capricious, contrary to Section-194 LA of Income Tax Act, Section-96 of The Right to Fair Compensation, Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 [Act 30 of 2013]; and Notification dt.28.08.2015 issued by Union of India 2 under sub Section-(3) of Section-105 of Act 30 of 2013 to and also violative of Articles-14 & 21 and Article-300A of Constitution of India; b) Consequently direct the 7th Respondent to return/pay the amount of Rs.22,06,350/- thus deducted towards T.D.S to the petitioner; c) For such other relief or reliefs ……” 3. The facts, as narrated in the affidavit filed in support of the writ petition, in brief, are as under:- The petitioner owns agricultural land to an extent of Ac.0-09 cents, Ac.1-12 cents, Ac.1-23 cents and Ac.1-53 cents situated in Sy.Nos.1402-3B, 1402-4, 1404-1B and 1404-1A/2 respectively at Anakapalli Village, Anakapalli Mandal, Visakhapatnam District. Thus, the total extent of the land held by the petitioner in the said survey numbers is Ac.4-87 cents out of which, respondent No.7 acquired agricultural land to an extent of 10,077 Sq.Meters situated in Sy.Nos.1404/1A2 and 1404/1B1 situated at Anakapalli Village, Anakapalli Mandal, Visakhapatnam District from her possession. An Award vide Award No.66/2020 came to be passed awarding an amount of Rs.3,67,72,491/- as compensation to her. Out of the said sum, an amount of Rs.2,94,17,993/- was towards land compensation and an amount of Rs.73,54,498/- was towards T.D.S. @ 20% and accordingly, ordered the T.D.S. amount @ 20% to be kept in deposit, which will be released after receipt of common affidavit 3 for family members’ apportionment and Memorandum of Understanding for tenant’s dispute. It is said that 60% of the said amount i.e., Rs.2,20,63,495/- was ordered to be released in favour of the petitioner but T.D.S. @ 10% was ordered to be deducted from out of the amount of Rs.2,20,63,495/-. Accordingly, an amount of Rs.1,98,57,145/- was only paid to the petitioner and the rest of the amount to a tune of Rs.22,06,350/- was deducted towards T.D.S. by the bank concerned. A cheque bearing No.001784 for an amount of Rs.2,20,63,495/- was issued and another cheque bearing No.001785 for an amount of Rs.22,06,354/- was issued towards T.D.S. and thereupon, an amount of Rs.1,98,57,145/- was only paid to the petitioner and the rest of the amount i.e., Rs.22,06,350/- was deducted towards T.D.S. @ 10% by Kotak Mahindra Bank. This action of respondent No.7 is sought to be challenged before this Court stating that the deduction of T.D.S. as contrary to the provisions of the Income Tax Act, 1961 and the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. 4. A counter came to be filed by respondent No.3/Income Tax Department disputing the averments made in the affidavit 4 filed in support of the writ petition. Para No.3 of the said counter reads as under:- “It is submitted that Section 194 LA of the Income Tax Act, 1961 provides for deduction of tax at source (TDS) at 10% on any immovable property (other than agricultural land) on which compensation is paid by the competent authority while compulsorily acquiring the same. As such, no deduction of tax at source is required to be made, if the lands compulsorily acquired are agricultural lands. In the facts of the present case, on verification with the revenue authorities it was made known to the Income Tax Department, that the subject lands of the petitioner, which were acquired by the 7th respondent is identified as zeroyithi wet land. It is found that the petitioner has obtained Permanent Account Number (PAN) on 25-4-2018 and has filed her return of income only for A.Y.2020-21. Since the tax has already been deducted in February, 2021 from the compensation paid in the case of the petitioner, she can file her return of income for A.Y.2021-22 and seek refund of the amount deducted at source, if the same is not liable to be taxed in her hands. A copy of the letter issued by the Tahsildar, Anakapalli, Visakhapatnam, is filed herewith as an annexure.” 5. The point that arises for consideration is:- “Whether respondent No.7 was right in deducting the tax at source?” 6. POINT:- As seen from the record, more particularly, para No.3 of the counter filed by respondent No.3, T.D.S. has been deducted while paying the compensation amount to the petitioner and the 5 same is in the account of the Revenue. Further, the petitioner is said to have obtained PAN number on 25.4.2018 and filed her Income Tax Returns only for the assessment year 2020-2021. Therefore, if the petitioner is entitled for refund, as claimed by her, she can make a claim before the authorities independently or in the next assessment year i.e., for the assessment year 2021-2022 in which event, the authorities shall deal with the same in accordance with law. 7. With the above direction, this Writ Petition is disposed of. There shall be no order as to costs. Miscellaneous petitions pending, if any, in this Writ Petition shall stand closed. _______________________________ JUSTICE C.PRAVEEN KUMAR ________________________________ JUSTICE A.V.RAVINDRA BABU Date : 25.8.2022 AMD 6 160 THE HONOURABLE SRI JUSTICE C.PRAVEEN KUMAR AND THE HONOURABLE SRI JUSTICE A.V.RAVINDRA BABU WRIT PETITION No.5069 of 2021 Date : 25.8.2022 AMD "