HARJINDER SINGH VEDI,DELHI vs. INCOME TAX OFFICER, CIVIC CENTRE

ITA 5085/DEL/2026Status: DisposedITAT Delhi29 September 2026AY 2022-235 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the assessee is eligible for the enhanced exemption limit under Section 10(10AA) of the Income Tax Act, 1961. The Tribunal referred to the Delhi High Court's decision in Kamal Kumar Kalia vs. UOI, which prima facie justified the grievance regarding the exemption limit not being raised since 1998, considering the upward revision of pay scales and inflation. The Tribunal noted that the Ministry of Finance subsequently revised the exemption limit to Rs.25,00,000/- vide notification dated 24th May, 2023, effective from 1st April, 2023. The Tribunal also cited several other Tribunal decisions (Sudhakar Gundappa Paldewar, Neelam Gupta, Ram Charan Gupta, Vijay Kumar Jain, Ram Dev Daiya, Govind Chhatwani) which allowed the benefit of the revised limit to similarly placed assessees who had superannuated prior to the notification. Therefore, the Assessing Officer was directed to allow exemption in respect of leave encashment as per the revised limit. No issue was expressly left undecided.

What were the facts?

The assessee, Harjinder Singh Vedi, superannuated from Central Bank of India during Assessment Year 2022-23 and received leave encashment of Rs.12,78,139/-. He claimed an exemption of Rs.3,00,000/- under Section 10(10AA) of the Income Tax Act, 1961, which was allowed by the CPC. Subsequently, the Ministry of Finance, following a Delhi High Court decision, enhanced the exemption limit to Rs.25,00,000/-. The assessee appealed to the CIT(A) seeking exemption on the balance amount of Rs.9,78,139/-, but was unsuccessful. This appeal is against the CIT(A)'s order dated 06.03.2026.

What were the issues?

1. Whether the assessee is eligible for the enhanced exemption limit under Section 10(10AA) of the Income Tax Act, 1961, for leave encashment received prior to the notification enhancing the limit, given that the Hon'ble Delhi High Court's decision was prior to the assessee's superannuation? Assessee's contentions: The assessee argued that since the limit of exemption under Section 10(10AA) was revised and the Hon'ble High Court's decision predated the assessee's superannuation, the assessee is eligible for the benefit of the revised limit. Reliance was placed on various Tribunal decisions holding that the entire leave encashment is eligible for exemption in light of the revised limit of Rs.25,00,000/-. Revenue's contentions: The Revenue contended that the assessee was not a Government employee and was therefore eligible for exemption only to the extent of Rs.3,00,000/- under Section 10(10AA)(ii) of the Act, which was correctly allowed by the CPC. The Revenue supported the impugned order and prayed for the dismissal of the appeal.

Which sections of the Income-tax Act were involved?

Section 10(10AA),Section 143(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI

Before: SHRI VIKAS AWASTHY

For Respondent: Shri Nirmal Nangia, Sr.DR

PER SHRI VIKAS AWASTHY, JUDICIAL MEMBER:

This appeal by the assessee is directed against the order of Additional/Joint Commissioner of Income Tax (Appeals)-1, Chennai [in short ‘the CIT(A)’] dated 06.03.2026, for Assessment Years 2022-23. 2. The facts of the case in brief as emanating from records are; the assessee superannuated from Central Bank of India during the period relevant to the assessment year under appeal. On superannuation the assessee

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 10(10AA)

All 498 judgments and leading authorities on Section 10(10AA) →

Latest GST High Court judgments

Search GST case law →