In Brief
The Supreme Court addressed whether compensation paid on mutually agreed terms for acquired land qualifies for exemption under Section 10(37) of the Income Tax Act, 1961. The Court held that agreed compensation does not alter the compulsory nature of the acquisition; instead, it remains a compulsory acquisition under tax law. Consequently, the exemption under Section 10(37) applies to such compensation. The negotiations between parties are limited to the compensation amount only. The Court upheld the High Court's decision and dismissed all appeals.
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