Section 10(10AA) of the Income Tax Act
Income-tax Act, 2025: s.19
Section 10(10AA) of the Income-tax Act, 1961 corresponds to section 19 (Deductions from salaries) of the Income-tax Act, 2025.
Read section 19 of the 2025 Act
Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.
The decision most relied on for Section 10(10AA) is India Ltd. v. ACIT (1997) 61 ITD 444 (Del) Indian Airlines Ltd. v. ACIT (93 Taxmann.com 89), cited in 64 of the 498 judgments on BharatTax that turn on this section.
Leading authorities on Section 10(10AA)
An assessee's bona fide estimate of employee perquisites, by valuing residential accommodation as if employees were of the Central Government, can be accepted.
Adjustments under Section 143(1)(a) are limited to arithmetical errors or incorrect claims that are prima facie apparent from the information provided in the income tax return itself. The Assessing Officer cannot embark on an inquiry beyond the face of the return during summary assessment proceedings.
Employees of Public Sector Undertakings (PSUs) and nationalized banks are not considered government employees for the purpose of exemption under Section 10(10AA) of the Income Tax Act.
The Income Tax Appellate Tribunal (ITAT) is the final fact-finding authority. Disagreements between different benches of the ITAT on factual findings necessitate reference to a larger bench.
Employees of a statutory corporation are not considered employees of the State or Central Government, making them ineligible for exemption under Section 10(10AA)(i) and rendering the employer liable for tax deduction at source.
A prima facie adjustment under section 143(1) cannot be made when the issue is debatable and two opinions are possible.
Employees of certain universities, like Haryana Agricultural University and Mahatma Gandhi University, are considered to hold civil posts under the State Government, entitling them to benefits under Section 10(10AA)(i) of the Income Tax Act.
