Judgment

Srinivasan, J.-The appellant owned certain lands in Nacharam village near Hyderabad. The Government of Andhra Pradesh acquired the same under the provisions of the Land Acquisition Act. A sum of Rs. 25,240/- was awarded as compensation by the Land Acquisition Officer on 20.11.65. On a reference at the instance of the appellant, the civil court enhanced the compensation to Rs. 2,72,136/- including solatium and interest. The same was affirmed on appeal by the High Court on 16.10.70. The appellant filed a return under Section 139(4) of the Income-tax Act (hereinafter referred to as the ‘Act’) On 17.2.72 disclosing the interest on belated payment of compensation as her income. The I.T.O. rejected it is invalid as it was filed beyond the period prescribed under Section 139(4) of the Act. The I.T.O. initiated proceedings under Section 147(a) of the Act for the year ending 31.3.65 in March 1973 and issued a notice under Section 148 on 21.4.73. He sought the sanction of the Commissioner on the ground that the land acquired was not agricultural land as it had not been subjected to agricultural operation and the capital gains thereon were chargeable to income-tax.

2. On 4.9.78, th