SUBRAMANIAN KATHIRSEN,AURANGABAD vs. INCOME TAX OFFICER, WARD 1 (1), AURANGABAD

ITA 765/CHNY/2025Status: DisposedITAT Chennai02 September 2025Bench: SHRI MANU KUMAR GIRI (Judicial Member), SHRI HON'BLE S.R. RAGHUNATHA (Accountant Member)1 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the ex-gratia compensation received by the assessee was capital in nature and not taxable. It was based on various ITAT and High Court judgments concerning similar payments from the same employer.

What were the facts?

The assessee received compensation of Rs. 53,34,390/- on premature cessation of employment from Pfizer Healthcare India Pvt. Ltd. The Assessing Officer treated this amount as income from other sources, disallowing relief under Section 89(1). The CIT(A) upheld the AO's decision.

What were the issues?

Whether the compensation received on premature cessation of employment is taxable as income from other sources or is a capital receipt. Whether relief under Section 89(1) is admissible.

Which sections of the Income-tax Act were involved?

Section 56(2)(xi),Section 2(24),Section 89(1),Section 17(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH: CHENNAI

Before: HON’BLE SHRI MANU KUMAR GIRI & SHRI HON’BLE S.R. RAGHUNATHA

Hearing: 01.07.2025Pronounced: 02.09.2025

PER MANU KUMAR GIRI (Judicial Member):

This appeal by the assessee is directed against order dated 15.01.2025 passed by the Ld. Commissioner of Income-tax (Appeals), NFAC Delhi [in short 'the Ld. CIT(A)'] for assessment year 2019-20. 2. The assessee has raised the following grounds of appeal:

“1. The learned CIT(A) has erred in understanding the provisions of Sec. 56(2)(xi) & 2(24) & has i

The order continues below.

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