COMMISSIONER OF INCOME TAX, BILASPUR vs. INCOME TAX APPELLATE TRIBUNAL AND ANR.

TAXC/9/2006HC ChhattisgarhCGHC01002008200604 May 2009Author: HON'BLE SHRI JUSTICE DHIRENDRA MISHRA,HON'BLE SHRI JUSTICE RANGNATH CHANDRAKAR2 pages
AI SummaryWithdrawn

What were the facts?

The assessee, Gyani Dass, received an ex-gratia amount of Rs. 5,76,687/- after voluntary retirement from Balco. The assessee claimed exemption for the entire amount under Section 10(10C) of the Income Tax Act, 1961, for the assessment year 2003-04. The Assessing Officer granted exemption only for Rs. 5,00,000/-, considering the amendment made by the Finance Act, 2003, which introduced the word 'received' in the said provision. The Income Tax Appellate Tribunal (ITAT) granted exemption for the entire amount, relying on earlier judgments. The Commissioner of Income Tax, Bilaspur (appellant revenue), preferred an appeal before the ITAT, Jabalpur, challenging the ITAT's order.

What did the High Court hold?

The Tribunal noted that the appellant revenue submitted that in several other matters where identical questions were involved, appeals filed by the revenue were dismissed as withdrawn because the department had preferred review petitions before the appellate tribunal. In these circumstances, the revenue sought permission to withdraw the present appeal with liberty to file a review petition before the appellate tribunal. The respondent assessee had no objection to this course of action. Accordingly, the appeal was disposed of with the liberty as prayed for by the revenue. The Tribunal did not decide the substantive issue regarding the interpretation of Section 10(10C) and the applicability of the amendment.

What were the issues?

1. Whether the exemption under Section 10(10C) of the Income Tax Act, 1961, for the ex-gratia amount received by the assessee upon voluntary retirement is to be considered based on the amount 'received' or the amount 'paid' to the assessee, in light of the amendment made by the Finance Act, 2003? Assessee's contentions: The assessee claimed exemption for the entire amount received, relying on the pre-amendment understanding of the provision where the words 'received' and 'paid' were used interchangeably and the exemption was granted for the entire amount received. The assessee also relied on earlier judgments of the Tribunal. Revenue's contentions: The revenue contended that the amendment by the Finance Act, 2003, specifically introduced the word 'received' in Section 10(10C), implying that the exemption should be limited to the amount actually received by the assessee, which was Rs. 5,00,000/-, as per the amended provision. The revenue also stated that in several other matters with identical questions, appeals filed by the revenue were dismissed as withdrawn because the department had preferred review petitions before the appellate tribunal.

Which sections of the Income-tax Act were involved?

Section 10(10C),Section 260A

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Cause title — parties, addresses and appearances
'TSI •*ii*ii<t<<, ©til+i'Ko,fqcii'ay t- ^ %^i ^ra^ (i?l3a<<^) OIVISION Bl HON'BLE MR. DHIRENEtRA MISHRA^ HON'BLE MR, R.N. CH^NbRAKAR. JJ I.T.A. No.09 of 2006 Aooellant Respondents (Appeal under Section 26p-A of Income Tax Act, 1961} Comrrfissioner. Income Tax. BilasDur Vs 1. In4ome Tax Appellate Tribunal, Jabalpur. 2. Gy^n Oos, Qtr. Nci.491, Sector-4, Baico Nafaar. Korba (C6) ; Present: Mr. 5. Rajeshwar Rao, Advocate Mr. R.S. Marhas, Advocate for ORA L (Passed on Dhjrendra Mishra, J; 1. The appellant has preferred Income Tax Act, 1961 against ITA No.lS/JAB/06 by the 2. The assessee received ex-9ra^ was permitted to voluntory re-t the amount was Daid to the assl He was 9ronted exemption-in a —flffloyntwhich he received WqferiN lOTHf <f ftt^ ^raifgffSii^i NCH: for The appellant. espondent No.2. riesi

^th May. 2009) ftis |iis appeal under Section 260A of the jthe order dated 19.04.2006 passed in Tax Appellate Tribunat, Jabalpur-.

Lio amount of Rs.5,76,687/- after he |red from Balco. However, only 1/5 of in the assessment year 2003-04. jscordance with Section 10 (lOc) on the |n that financial year and not on Inc4me graf' ass&ssee ^^^(TeRTCT^' |i008—!,00,0fl0. "p-j'fj:i'{rT;1"'

The order continues below.

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