15 June 2022
Sir, Interest received from Motor Accident Compensation Tribunal is taxable ? If Taxable, 50% deduction on compensation or Enhanced compensation is available for such interest? How to show Such income in Income Tax Return ?
15 June 2022
Pardiwala and Justice Nisha M. Thakore has held that the interest awarded by the Motor Accident Claim Tribunal (MACT) under section 171 of the Motor Vehicles Act 1988 is not taxable under the Income Tax Act, 1961.
Compensation awarded under Motor Vehicles Act or Employees’ Compensation Act in lieu of death of a person or bodily injury suffered in a vehicular accident, is a damage and not an income and cannot be treated as taxable income including interest payment. It's applicable for AY 2022-23.
15 June 2022
The said interest forms part of compensation and which is not taxable under provisions of Section 56(2)(viii) of the Income Tax Act, 1961.
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