Akash (proprietor) (82 Points)
30 August 2019Dear Experts,
Can you please tell me where to show the compensation money received on compulsory acquisition of agricultural land in Noida in ITR-3.
The compensation amount is Rs 7 Lac
Should we show it in Exempt income colum in 'Other income' and in details should mention as 'Compensation received'
Please confirm?
Thans in advance
Varun Dave
(Student)
(7 Points)
Replied 30 August 2019
Suresh Thiyagarajan
(Student)
(3986 Points)
Replied 30 August 2019
1. As per sec 45(5) compulsory acquisition of Capital asset will be chargeable to tax in the year of receipt of such compensation.
2. However, if the land is in the nature of "agriculture land" then it will not come within the purview of sec 45(5) and resultantly capital gains will not be chargeable to tax.
3. In your case, you have mentioned it as agriculture land and hence the compensation will be exempt from payment of tax u/s 10(37) and no capital gains will arise.
4. The same should be mentioned in the appropriate column in relevant ITR.
Please correct me if the above solution has an alternative view.
Kapadia Pravin
(17249 Points)
Replied 30 August 2019
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