VRS compensation exemption under income-tax law was allowed even though the claim was not made in the return.

Compensation received under the BSNL VRS-2019 voluntary retirement scheme was treated as eligible for exemption under section 10(10B) of the Income-tax Act, 1961. The claim was accepted even though the exemption had not been claimed in the return of income, because the matter was raised before the appellate authority and the record showed the amount had been taxed only due to the earlier omission. The assessee was accordingly held entitled to the statutory exemption and the consequential refund relief.

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Issues: Whether compensation received under the BSNL VRS-2019 scheme was eligible for exemption under section 10(10B) of the Income-tax Act, 1961, and whether the assessee was entitled to corresponding relief despite not having claimed the exemption in the return of income.

Analysis: The compensation was received under a voluntary retirement scheme implemented by BSNL. The claim for exemption was raised before the appellate authority, and the record indicated that the amount had been subjected to tax deduction at source and offered to tax in the return only because the exemption was not claimed earlier. The appellate order was set aside in substance, and the Tribunal accepted that the assessee was entitled to the statutory exemption and the consequential refund relief.

Conclusion: The exemption under section 10(10B) was allowed in favour of the assessee, and the related tax consequence was also granted.

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