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Lutchmumun and others v Director General of the Mauritius Revenue Authority, Privy Council, 1 December 2008
In Mauritius, the taxpayers obtained a permit under the Sugar Industry Efficiency Act 1988 to convert some land.
They subsequently bought the land, but were later served with a compulsory acquisition of land notice. They claimed compensation and received more than they paid for the land.
The Mauritius revenue authority decided the compensation was taxable income.
The taxpayers appealed.
The Tax Appeal Tribunal of Mauritius found for the taxpayers, so the Revenue appealed. The Supreme Court allowed the Revenue’s appeal. The matter then proceeded to the UK Privy Council.
The Privy Council ruled that the compensation was taxable and confirmed the Supreme Court’s decision.
A decision was made in favour of the Revenue.
