(1) wp2115-11 IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD WRIT PETITION NO. 2115 OF 2011 Shamrao Sitaram Adhe and others PETITIONERS VERSUS The State of Maharashtra and others RESPONDENTS ..... Mr. A.P. Chawre, advocate holding for Mr. D.L. Suryawanshi, advocate for the Petitioners. Mr. S.K. Tambe, A.G.P. for the Respondent-State. Mr. Alok Sharma, Assistant Solicitor General for Respondent No. 3. ..... CORAM : B.R. GAVAI AND M.T. JOSHI, JJ. DATED : 20th SEPTEMBER, 2011 ORAL ORDER: 1. Rule. Rule made returnable forthwith and heard finally by consent. 2. By way of present petition, the petitioners have approached this Court being aggrieved by the action on behalf of Respondent No. 2 in deducting 10% of the amount of compensation payable to the petitioners and crediting it with the Respondent No. 3. (2) wp2115-11 3. The lands of the petitioners has been acquired for the public purposes i.e. Ashti Hastur Tanda Minor Irrigation Tank and Ashti Percolation Tank. After the lands were acquired, the necessary proceedings for determination of compensation, passing of the Award were initiated by the Respondent No. 2. However, when the Award was passed, 10% of the amount from the compensation was deducted by the Respondent No. 2 and deposited with Respondent No. 3. Being aggrieved by the said action, the petitioners have approached this Court. 4. It is the contention of the petitioners that since the lands of the petitioners which were acquired, were agricultural lands, they were not assessable to Income Tax and as such, the action on part of Respondent No. 3 in deducting the amount from the compensation is not sustainable in law. 5. In the affidavit-in-reply filed on behalf of Respondent No. 3, it is stated that in view of the Judgement of the Kerala High Court in the case of "Nalini vs. Deputy Collector, Land Acquisition" (3) wp2115-11 294 ITR 0423 (Ker.) 2007, it is for the Income Tax Authorities to decide and determine whether the compensation awarded by the S.L.A.O. is in respect of an agricultural land as defined under the Income Tax Act or not. 6. However, it has been stated by the Respondent No. 3 in its affidavit-in-reply as under : "I however, clarify that on examining the Award passed by the competent authority it does appear that the land in question which is situated at Ashti, Tq. Partur is an Agricultural land even U/Sec. 2 (14) (iii) (A) of the Income Tax Act." 7. Without going into the legal aspects as to whether the judgement relied on by the Respondent No. 3 is based on correct proposition of law or not, we find that in view of the statement on behalf of Respondent No. 3 that the land in question is an agricultural land even under Section 2 (14) (iii) (A) of the Income Tax Act, we find that it will not be (4) wp2115-11 appropriate to direct the petitioners to again go through the cumbersome exercise of making application to the Income Tax Authorities for refund of the amount. Admittedly, under the provisions of the Income Tax Act, the compensation received on account of acquisition of the agricultural land is not assessable to the Income Tax. The petitioners are poor farmers. If they are required to make application before the Income Tax Authorities, they would be required to engage the services of Chartered Accountants/Income Tax Practitioners, which would unnecessarily entail an expenditure for recovering the amount to which they are entitled in law. 8. In that view of the matter and peculiar facts involved in the present case, we allow the Writ Petition. The Respondent No. 3 shall refund the amount deducted from the compensation payable to the petitioners while passing the Award and deposited with it by Respondent No.2. The Respondent No. 3 shall refund to the Respondent No. 2 the said amount with the interest accrued thereon in accordance with the provisions of relevant Act and Rules, within a (5) wp2115-11 period of six weeks from today. On receipt of the said amount, the Respondent No. 2 shall refund the same to the respective petitioners within a period of four weeks from the receipt thereof. Rule is made absolute accordingly. [M.T. JOSHI, J.] [B.R. GAVAI, J.] npj/wp2115-11