BSNL VRS compensation treated as retrenchment compensation and exempt under the Income-tax Act.

Compensation received under the BSNL voluntary retirement scheme was treated as retrenchment compensation and held exempt under section 10(10B) of the Income-tax Act, 1961. The ITAT followed its coordinate bench ruling on the same scheme and factual matrix, finding no change in law or facts that justified a different view. The exemption claim was therefore accepted and the assessee obtained relief.

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Issues: Whether compensation received under the BSNL voluntary retirement scheme was exempt as retrenchment compensation under section 10(10B) of the Income-tax Act, 1961.

Analysis: The Tribunal noted that the assessee had received compensation under the BSNL VRS and had claimed exemption in respect of the amount. It followed the coordinate bench decision on the same scheme and factual matrix, which had held such compensation to be exempt under section 10(10B). The Tribunal found no change in the legal position or in the facts warranting a different view.

Conclusion: The compensation was held to be exempt under section 10(10B) of the Income-tax Act, 1961, and the assessee succeeded.

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