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| The Tax Publishers2020 TaxPub(DT) 2061 (Tela-HC) INCOME TAX ACT, 1961
Section 56
Enhanced sale consideration received by assessee due to delay in completion of the sale transaction on account of default of buyer of property, could not be termed as 'interest' and subjected to levy of tax under the head 'income from other sources', and the same could only be construed as balance of sale consideration.
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Income from other sources - Chargeability - Enhanced sale consideration received due to delay in completion of sale transaction on account of default of buyer of property -
Revenue alleged that enhanced sale consideration received by assessee due to delay in completion of the sale transaction on account of default of buyer of property would be termed as 'interest' and subjected to tax under the head 'income from other sources'. Held: Enhanced sale consideration received by assessee due to delay in completion of the sale transaction on account of default of buyer of property, could not be termed as 'interest' and subjected to levy of tax under the head 'income from other sources', as there was no finding by the Revenue as to what was the rate of interest for the delayed payment; and hence, the payment could only be construed as balance of sale consideration.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. :
INCOME TAX ACT, 1961
Section 54
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