Income tax on court order (principle along with interest)
Satyan manuja
(Querist) 27 December 2020
This query is : Resolved
As per brief order of State commission as follows
No other point was raised during the course of arguments. It is a clear case of deficiency in service. The complainants cannot be compelled to wait for more time for completion of construction and development work and delivery of possession as the complainants have already suffered a lot. Resultantly, it is held that the complainants are entitled to recover the total amount deposited by them Rs.24,11,528/- with interest at the rate of 12% per annum from the date of respective deposits till realization. Keeping in mind the un-necessary harassment and mental agony, suffered by the complainants as well as the amount spent in this litigation, it will be justified to award an amount of Rs.25,000/- as compensation on account of unnecessary harassment and mental agony and an amount of Rs.10,000/- as litigation expenses. I received Rs. 24,11,528/- as principal amount, 20,96,472/- as interest and 25,000/- and 10,000 as mental agony and legal expenses.
Is there any tex liability because I heard that interest awarded by court now liable to tax https://www.taxmanagementindia.com/visitor/detail_article.asp?ArticleID=1439
KIndly guide properly.
Read more at: https://www.caclubindia.com/forum/income-tax-liability-on-court-order-567069.asp
Isaac Gabriel
(Expert) 27 December 2020
Interest is an income and accounted.As such it needs to be computed towards your tax liability.
Satyan manuja
(Querist) 27 December 2020
BUT SIR AS BELOW LINK INTEREST AWARDED BY COURT NOT LIABLE TO TAX
https://www.taxmanagementindia.com/visitor/detail_article.asp?ArticleID=1439
kINDLY read and guide
K.S.Ramaswamy Advocate
(Expert) 29 December 2020
Interest is an income arising out of other sources and therefore taxable in my view and the queriest may consult local experts opinion.
