ABHAY HIRALAL GANDHI,AHMEDABAD vs. THE ITO, WARD-6(1)(1), AHMEDABAD

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ITA 1955/AHD/2024Status: FixedITAT Ahmedabad11 April 2025AY 2019-20Bench: MS. SUCHITRA KAMBLE (Judicial Member), SHRI MAKARAND V. MAHADEOKAR (Accountant Member)4 pages
AI SummaryWithdrawn

What did the Tribunal hold?

The tribunal noted that the assessee had subsequently filed another rectification application which led to the acceptance of the returned income and nullification of the demand. Therefore, the appeal was dismissed as withdrawn.

What were the facts?

The assessee, an employee of State Bank of India, retired and claimed exemption of Rs. 8,90,808/- for leave encashment. Initially, the return was processed accepting the claim. However, a rectification order disallowed a portion of the exemption, leading to a demand and an appeal.

What were the issues?

Whether the appeal should be dismissed as withdrawn due to subsequent events that rectified the original order and demand.

Which sections of the Income-tax Act were involved?

Section 250,Section 154,Section 10(10AA),Section 143(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD

Before: MS. SUCHITRA KAMBLE & SHRI MAKARAND V. MAHADEOKAR

For Appellant: Ms. Kaushani Shah, AR on behalf of Shri Hardik Vora, AR
For Respondent: Smt. Mamta Singh, Sr.DR
Hearing: 09/04/2025Pronounced: 11/04/2025

This appeal is filed by the assessee against the order passed by the Commissioner of Income Tax (Appeal), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as “CIT(A)”] under section 250 of the Income Tax Act, 1961 [hereinafter referred to as “the Act”], dated 14.11.2024 for the Assessment Year 2019-20, confirming the rectification order passed by the Assessing Officer u/s 154 of the Act on 29.10.2021.

Abhay Hiralal Gandhi vs. ITO A.Y. 2019-20 2 2. The brief facts of the case are that the assessee is an individual employed with the State Bank of India and retired during the year under consideration. In the return of income filed for the Assessment Year 2019-20 on 10.07.2019, the assessee had declared a total income of Rs. 10,99,280/- and claimed exemption of Rs. 8,90,808/- u/s 10(10AA) of the Act on account of leave encashment on retirement. The return was processed u/s 143(1) on 23.11.2019 accepting all the deductions and exemptions claimed.

3.

Subsequently, the CPC, Bengaluru, passed a rectification order u/s 154 dated 29.10.2021 allowing exemption to the extent of Rs. 3,00,000/- only and disallowed the balance claim of Rs. 5,90,808/-, resulting in a demand of Rs. 1,88,580/-. Aggrieved by the said rectification order, the assessee preferred an appeal before the CIT(A). The learned CIT(A), vide order dated 14.11.2024, upheld the disallowance, holding that the assessee, being a retired employee of a public sector undertaking (SBI), could not be treated as a government employee for the purpose of claiming full exemption u/s 10(10AA) of the Act. The CIT(A) further observed that the claim of the assessee was prima facie not acceptable and hence no infirmity was found in the action of the Assessing Officer in disallowing the exemption under the rectification proceedings.

4.

Aggrieved by the order o CIT(A) the assessee filed an appeal before us.

5.

During the course of proceedings before us, the learned Authorised Representative (AR) filed a written application dated 08.04.2025 seeking withdrawal of the appeal, stating that subsequent to the impugned orders, the assessee had filed another rectification application u/s 154 on 12.10.2022. Pursuant to the said application, the Assessing Officer passed a rectification Abhay Hiralal Gandhi vs. ITO A.Y. 2019-20 3 order dated 25.10.2022 accepting the returned income as originally filed. Consequently, the demand was nullified and a refund of Rs. 1,010/- was determined. It was further submitted that while processing the refund, the earlier payment of Rs. 1,88,580/- made by the assessee on 18.11.2021 was not taken into account and a letter has already been submitted to the Assessing Officer seeking issuance of the due refund.

6.

Considering the subsequent development and submissions made by the learned AR, the appeal is dismissed as withdrawn. However, the assessee is granted liberty to restore the appeal in accordance with law, in case any difficulty arises in the matter of refund or any other connected issue.

7.

In the result, the appeal is dismissed as withdrawn, with liberty as per Para 6 hereinabove.

Order pronounced in the Open Court on 11th April, 2025 at Ahmedabad.

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