PRAKASH SUKHDEO SONAWANE,AURANGABAD vs. INCOME TAX OFFICER, WARD 1(1), AURANGABAD, AURANGABAD

ITA 2180/PUN/2025Status: DisposedITAT Pune08 June 2026AY 2019-2021 pages
AI SummaryAllowed

What were the facts?

The assessee, an ex-employee, received Rs. 65,21,105/- under a voluntary retirement scheme due to plant closure. He claimed relief under Section 89 for advance salary, which was disallowed by the AO. The CIT(A) upheld the disallowance and also treated the amount as taxable under Section 56(2)(xi).

What did the Tribunal hold?

The Tribunal held that the amount received under the voluntary retirement scheme does not constitute termination of employment and therefore Section 56(2)(xi) is not applicable. The Tribunal also noted that similar payments to other employees were accepted as capital receipts.

What were the issues?

Whether the compensation received under a voluntary retirement scheme is taxable as income from other sources under Section 56(2)(xi), and whether relief under Section 89 is admissible for advance salary.

Which sections of the Income-tax Act were involved?

Section 89,Section 56(2)(xi),Section 10(10C),Section 80JJAA

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, PUNE

Before: SHRI R.K. PANDA & MS. ASTHA CHANDRA

For Appellant: Shri Nikhil S Pathak &
For Respondent: Shri Sandip Pawar

PER ASTHA CHANDRA, JM :

The appeal filed by the assessee is directed against the order dated 24.07.2025 of the Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi [“CIT(A)/NFAC”] pertaining to Assessment Year (“AY”) 2019-20. 2. Briefly stated facts of the case are that the assessee is an individual and ex-employee of M/s. Pfizer Healthcare India Pvt. Ltd., Aurangabad (“Pfizer India”). For AY 2019-20, the assessee filed his return of income claiming a refund of Rs.22,97,400/- and relief of Rs.21,77,119/- u/s 89 of the Income Tax Act, 1961 (the “Act”) for advance salary received. During the AY 2019

The order continues below.

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