JIGNESH VINODCHANDRA KANSARA,AHMEDABAD vs. INCOME TAX OFFICER, CIRCLE 3(1)(1), AHMEDABAD

The present appeal has been preferred by the Assessee against the Order, dated 29/03/2026, passed by the Learned Commissioner of Income Tax, Appeal - ADDL/JCIT(A) - 6, Chennai [hereinafter referred to as the ‘CIT(A)’] whereby the Learned CIT(A) had partly allowed the appeal against the Intimation Order, dated 25/08/2023, issued under Section 143(1) of the Income Act, 1961 [hereinafter referred to as ‘the Act’] for the Assessment Year 2023-2024. 2. The Assessee has raised following grounds of appeal:

The order passed by lower authorities is bad in law and required to be quashed. Assessment Year2023-2024

Ld. JCIT (A) ought to have treated retrenchment compensation received as tax exempt u/s 10(10B) of the Act.

Appellant prays that it is duty of AO to tax correct income and accordingly, AO ought to have granted deduction u/s 10(10B) of the Act instead of section 10(10C) of the Act.

We have heard both the sides and have perused the material on record.

The Assessee in the present case is an individual. During the relevant previous year the Assessee received compensation under Bharat Sanchar Nigam Limited Voluntary Retirement Scheme - 2019 [for short 'BSNL VRS-2019']. Due to lack of awareness of the legal provisions at the time of filing the return of income and on account of the fact that the employer deducted tax at source from the said compensation received under the BSNL VRS-2019, the Assessee inadvertently offered the same to tax in the return of income for the Assessment Year 2020-2021 which was processed under Section 143(1) of the Act.

Subsequently, based on the decision of the Chandigarh Bench of the Tribunal in the case of Harish Kumar vs. ITO Ward 5(5), Chandigarh (ITA No. 42/CHD/2025 dated 30/05/2025), wherein compensation under the BSNL VRS-2019 scheme was held to be exempt under Section 10(10B), the Assessee filed appeal before the Learned CIT(A) raising additional claim of exemption under Section 10(10B) of the Act in respect of the compensation received. It was contended by the Assessee that the compensation was not taxable and therefore, the Assessee was eligible for the refund of the amount of tax deducted at source from such compensation. The Learned CIT(A) partly allowed the appeal holding that the Assessee was entitled to benefit of Section 10(10C) of the Act and not Section 10(10B) of the Act as contended by the Assessee. Thus, the Learned CIT(A) held that compensation upto INR.500,000/- was exempt while the balance was 2 Assessment Year2023-2024

Not being satisfied by the relief granted, the Assessee has now preferred the present appeal on the grounds reproduced in paragraph 2 above.

We find that identical issue had come up for consideration before the Tribunal in the case of Jayeshkumar Tulsidas Sutaria Vs. The Income Tax Officer, Ward 7(2)(1), Ahmedabad: ITA Nos.2387 & 2388/AHD/2025 (Assessment Years: 2020-21 & 2021-22) wherein in the case of identically placed employee of BSNL, the Tribunal accepted contentions of the Assessee; condoned the delay in filing appeal before the Learned CIT(A) against intimation issued under Section 143(1) of the Act, and directed the Assessing Officer to grant refund to the Assessee holding that the compensation received by the assessee under the same BSNL VRS 2019 was exempt under Section 10(10B) of the Act. The aforesaid decision of the Tribunal was followed in the case of Kirtida Rajeshkumar Shah Vs. The Income Tax Officer, Ward 7(2) (1), Ahmedabad:ITA Nos.151/AHD/2026 (Assessment Years: 2020-21) and Chhaganlal Bhimabhai Vs. The Income Tax Officer, Ward 1(2), Bhavnagar: ITA Nos.2547 & 2548/AHD/2025 (Assessment Years: 2020-21 & 2021-22).

There is no change in the legal proposition and the factual matrix. In the above decision, the Tribunal has consistently held that the compensation received under the BSNL VRS-2019 by identically placed employees was exempt from tax under Section 10(10B) of the Act. The Revenue has failed to distinguish the above decisions of the Tribunal either on facts or in law. Further, the view taken by the Tribunal finds support in Circular No. 14 of 1955 issued by the Central Board of Direct Taxes directing officers not to take advantage of ignorance of an assessee as to their rights and assist them in claiming and securing reliefs/refunds.

In view of the above, accepting the claim of the Assessee we hold that the compensation received by the Assessee during the relevant previous year under BSNL VRS - 2019 is exempt under Section 10(10B) of the Act. The Assessing Officer is, therefore, directed to computed the taxable income of the Assessee accordingly and grant refund due, if any, as per law. Thus, in terms of the aforesaid, Ground No. 2 and 3 raised by the Assessee are allowed while Ground No. 1 is dismissed as having been rendered infructuous.

In result, the present appeal preferred by the Assessee is partly allowed.

""यथ"/ The Respondent. JEETENDRA DEVENDRABHAI UPADHYAY DN: c=IN, o=PERSONAL, 3. संबंिधतआयकरआयु"/ Concerned CIT title=6087, DEVENDRA 2.5.4.20=7e5568a89b633f174b28a 80f5e63c638da40b7313fb47ebaef 4. da841cf59d1703, आयकरआयु"(अपील) / The CIT(A) BHAI postalCode=380059, st=Gujarat, serialNumber=816dc56e896211a1 5. िवभागीय"ितिनिध, आयकरअपीलीयअिधकरण/ DR, ITAT, a21ccc4abc94ddc94458f4a1b37be UPADHYAY 8e1854e9399295106d4, cn=JEETENDRA DEVENDRABHAI 6. गाड"फाईल /Guard file. UPADHYAY Date: 2026.10.28 10:11:50 +05'30' आदेशानुसार/BY ORDER, उप/सहायकपंजीकार (Dy./Asstt.