In Brief
Union of India and others appealed against High Court directions to refund tax deducted at source (TDS) on land acquisition compensation to the Collector. The issue was whether TDS under Section 194-LA of the Income Tax Act applied to agricultural land compensation. The Supreme Court held that the High Court erred in directing the Collector to determine the land's nature; this is the Assessing Officer's function. Claimants must approach Assessing Officers with returns claiming the land was agricultural, which the Officer will examine. If agricultural, the deposited tax shall be refunded. Future Collectors must notify claimants of tax liability and issue certificates as per Kerala High Court guidelines.
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