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Issues: (i) Whether delay of 298 days in filing appeal before the Commissioner (Appeals)/NFAC should be condoned; (ii) Whether gratuity of Rs.7,19,063 is exempt from tax under section 10(10) of the Income-tax Act, 1961; (iii) Whether commuted pension of Rs.15,25,689 is exempt from tax under section 10(10A) of the Income-tax Act, 1961; (iv) Whether addition of Rs.3,84,000 made as unexplained money under section 69A of the Income-tax Act, 1961 is sustainable.
Issue (i): Whether the delay of 298 days in filing the appeal before the Commissioner (Appeals)/NFAC should be condoned.
Analysis: Affidavit evidence establishes relocation, non-receipt of notices at earlier address, limited digital literacy, and reliance on a tax consultant; precedent principles favour preferring substantial justice over technical disallowance of appeals where sufficient cause exists; the period and reasons were evaluated in context and compared with authorities allowing condonation for longer delays.
Conclusion: Delay of 298 days is condoned and the appeal is admitted for adjudication on merits in favour of the appellant.
Issue (ii): Whether gratuity of Rs.7,19,063 is exempt under section 10(10) of the Income-tax Act, 1961.
Analysis: Salary certificate (Form 16) from the employer confirms receipt and nature of the amount as death-cum-retirement gratuity; no additional documentary requirement was shown to be necessary to establish exemption; the disallowance by the assessing authority rested on absence of reply rather than on any substantive dispute regarding entitlement to statutory exemption.
Conclusion: Rs.7,19,063 is exempt under section 10(10) of the Income-tax Act, 1961 and the addition against salary is deleted in favour of the assessee.
Issue (iii): Whether commuted pension of Rs.15,25,689 is exempt under section 10(10A) of the Income-tax Act, 1961.
Analysis: Employer-issued salary documentation supports the characterisation of the receipt as commuted pension; the assessing authority's addition was founded on non-production of documents despite the Form 16 confirmation; no basis was shown for treating the amount as taxable salary rather than exempt commuted pension.
Conclusion: Rs.15,25,689 is exempt under section 10(10A) of the Income-tax Act, 1961 and the corresponding addition is deleted in favour of the assessee.
Issue (iv): Whether the addition of Rs.3,84,000 as unexplained money under section 69A of the Income-tax Act, 1961 is sustainable.
Analysis: Declared income and accepted pension/retirement receipts provide a legitimate and sufficient source for the time deposit; interest from the deposit was declared; the addition was based on conjecture without evidence disproving the declared source; no books or assets indicating undisclosed wealth were shown.
Conclusion: Addition of Rs.3,84,000 under section 69A is deleted and the addition is disallowed in favour of the assessee.
Final Conclusion: The appeal is allowed on merits after condoning delay; exemptions under section 10(10) and section 10(10A) are upheld and the addition under section 69A is deleted, resulting in a decision favourable to the assessee.
Ratio Decidendi: When statutory exemptions are supported by employer-issued salary certification and the assessee's declared income adequately accounts for an investment, additions as unexplained income under section 69A cannot be sustained on conjecture; condonation of delay is warranted where sufficient cause is shown and substantial justice requires merit adjudication.
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