Full Judgment
1. Heard finally.
2. Rule DB.
3. The petitioners seek a direction to the Land Acquisition Collector to refund the amount of tax deducted from the amount of interest awarded to them under Sections 28 and 34 of the Land Acquisition Act, 1894. The tax was deducted at source consistently with the obligation of the Land Acquisition Collector created by Section 194A of the Income-tax Act, 1961. According to the petitioners, the amount of interest being not liable to tax, the Land Acquisition Collector was not justified in deducting the tax at source.
4. The issue is no more rest Integra in view of same pronouncement of the Supreme Court in Bikram Singh v. Land Acquisition Collector : [1997]224ITR551(SC) , wherein their Lordships have held that such an amount of interest on delayed payment of compensation determined under the Land Acquisition Act was a revenue receipt exigible to income-tax under Section 4 of the Act. However, the claimant would be entitled to spread over the income for the period for which payment came to be made, so as to compute the income for assessing tax for the relevant accounting year. In view of the law so laid down the petitioner is not entitled to the relief prayed for.
5. However, learned counsel for the petitioner relied on Satinder Singh v. Umrao Singh, : [1961]3SCR676 , to submit that compensation would not betreated as income. Learned counsel further submitted that the decision of the Supreme Court in Satinder Singh's case : [1961]3SCR676 was not brought to the notice of the Supreme Court when Bikram Singh's case : [1997]224ITR551(SC) , was decided. It is also submitted that the reasoning on which their Lordships have proceeded in the case of Satinder Singh, : [1961]3SCR676 , was also not argued before the Supreme Court in Bikram Singh's case : [1997]224ITR551(SC) . Not only are we not satisfied about the correctness of the submission so made, we are also of the opinion that such a plea is not open for consideration by us and Bikram Singh's case : [1997]224ITR551(SC) , being a later pronouncement of the Supreme Court by a Bench of co-equal strength, it is binding on us.
6. The senior standing counsel for the Revenue has pointed out that the definition of interest has undergone a change after the pronouncement of the Supreme Court in the case of Satinder Singh, : [1961]3SCR676 . He also submitted that in Satinder Singh's case : [1961]3SCR676 , the interest paid was by way of compensation while in the case at hand interest has been allowed as interest on the amount of compensation in accordance with the statutory provisions.
7. The petitioner is at liberty to have the income on account of interest assessed by seeking spread over consistently with the law laid down by the Supreme Court in the case of Bikram Singh : [1997]224ITR551(SC) . So far as the present petition is concerned, we hold the petitioner not entitled to any relief. The petition is dismissed. No order as to costs.