Monday, June 6, 2016

Interest on compensation paid to accident victim is tax-free

a) The assessee was travelling in a car, which met a serious accident, leaving her permanently disabled. She claimed a compensation for this tragic loss of her physical abilities. She did eventually get it after the long struggle of 21 years.

b) But this long struggle was not enough, the destiny had more in store for her. It is this settlement of the accident compensation claim that has led to a new round of litigation- this time about taxability of a component of compensation, i.e. interest component.

c) During assessment proceedings, the Assessing Officer held that that interest component on compensation was taxable as it is covered under section 145A(b) r.w.s. 56(viii).The CIT(A) had also confirmed this stand. The aggrieved-assessee filed the instant appeal.

The Tribunal held in favour of assessee as under:

IndiGo Airlines didn't abuse dominance by hiring AirIndia's pilots a􀁺er obtaining NOC from competent authority

a) The Appellant, Air India, had filed information against the respondent- Indigo alleging that it had systematically indulged in predatory recruitment of trained pilots of appellant and had contravened provisions of section 4 of Competition Act, 2002.

b) The Commission held that allegations against respondent did not raise any competition concern in market and there was no bar on informant or any other airlines from recruiting pilots belonging to other airlines after seeking 'No objection Certificate' from them On appeal, the Competition Appellate Tribunal held as under:

1) Since except making bald allegations appellant did not produce any tangible evidence on record to prima facie show that respondent had in fact indulged in predatory hiring of pilots already serving other airlines and, thereby, affected flying operations of particular airlines, which could be treated as abuse of dominant position within meaning of section 4(2) or violation of section 3(3)(b) and (c), Commission could not have returned a prima facie finding that respondent had indulged in anti-competitive activities or abused its dominant position in relevant market