ROSHAN LAL GOYAL,HISAR vs. ITO, HISAR

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ITA 4075/DEL/2016Status: DisposedITAT Delhi05 January 2017AY 2010-114 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the issue is covered by previous decisions of the Coordinate Bench, which allowed similar exemptions for employees of the same university. Therefore, the assessee is entitled to the exemption for arrears of gratuity and leave encashment.

What were the facts?

The assessee, an employee of Chaudhary Charan Singh Haryana Agricultural University, claimed exemption for arrears of gratuity and leave encashment under Section 10(10) of the Income Tax Act. The Assessing Officer and CIT(A) rejected this claim, stating the assessee was not a government employee.

What were the issues?

Whether arrears of gratuity and leave encashment received by an employee of an agricultural university are eligible for exemption under Section 10(10) of the Income Tax Act.

Which sections of the Income-tax Act were involved?

Section 10(10),Section 10(10)(i),Section 10(10AA)(i)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘SMC-3’, NEW DELHI

Before: SHRI J. SUDHAKAR REDDY

ORDER This is an appeal filed by the Assessee directed against the order of the Ld. Commissioner of Income Tax (Appeals), Hisar dated 23.12.2015 pertaining to the Assessment Year (A.Y.) 2010-11.

1.

1.1. There is a delay of 150 days in filing the appeal. After perusing the condonation for delay application and the evidences filed therein, I am convinced that the assessee was prevented by sufficient cause from filing the appeal in time. Hence I condone the delay and admit the appeal.

2.

The assessee is an employee of the Chaudhary Charan Singh Haryana Agricultural Unviersity, Hisar and retired on 31.10.2006. He received arrears of gratuity which was claimed as exempt u/s 10(10) of the Income Tax Act, 1961 (the Act). He also received Rs.3,50,000/- as leave encashment which was also claimed as exempt u/s 10(10) of the Act. The Assessing Officer (AO) as well as the CIT(A) rejected the claim of the assessee on the ground that the assessee cannot be termed as a government employee.

3.

The Ld.Counsel for the assessee relied on a number of Coordinate Bench decisions of ITAT including ITA 1219/Del/16 by SMC-I, New Delhi in the case of Shri Joginder Paul Bhanot vide order dt. 19.7.2016 and ITA 4094/Del/16 in the case of Sh. Anoop Singh order dt. 18.10.2016 and submitted that the issue is covered in favour of assessee.

4.

The Ld.D.R. strongly opposed the contentions of the assessee by submitting that the assessee is neither an employee of the state government nor central government and that the University is neither under the control of state government nor the pay is debited to the Consolidated Fund of the State.

5.

After hearing rival contentions I find the issue is squarely covered in favour of the assessee and against revenue by the above referred decisions. In ITA 4094/Del/16 in the case of Sh. Anoop Singh, the SMC 1 Bench of Delhi Tribunal has at para 5 held as follows. “5. I have heard the Ld.AR and perused the relevant material on record. It is observed that the Delhi Bench of the Tribunal in the case of Shri Ram Kanwar Rana vs. ITO, Ward 3, Hisar in ITA 1307/Del/16 has allowed exemption in respect of the arrears of gratuity and arrears of leave encashment and dismissed the grounds about initiation of reassessment. Similar view has been taken in Raghubir Singh Panghal vs. ITO in ITA 1308/Del/16. Following the same, I extend the benefit of exemption to the instant assessee also in respect of arrears of gratuity and leave encashment u/s 10(10)(i) and 10(10AA)(i) of the Act.”

5.1. Respectfully following the same, I extend the benefit of exemption to the assessee in respect of arrears of gratuity and leave encashment u/s 10(10)(i) and 10(10AA)(i) of the Act and allow the appeal of the assessee.

6.

In the result the appeal of the assessee is allowed.

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