Retrenchment compensation under BSNL VRS-2019 qualifies for section 10(10B) exemption, with appellate relief allowed despite no return claim.

Compensation received under BSNL VRS-2019 was treated as retrenchment compensation, satisfying the conditions for exemption under section 10(10B) of the Income-tax Act. The Tribunal followed coordinate bench decisions on the same scheme and accepted that the legal and factual position remained unchanged. It also noted that the claim had been raised before the appellate authority, so the assessee was entitled to the relief despite not claiming it in the return. Exemption was thus allowed on the retirement compensation, including leave encashment if part of the scheme-linked amount.

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Issues: Whether ex-gratia compensation received under BSNL VRS-2019, together with leave encashment arising from retirement, was eligible for exemption under section 10(10B) of the Income-tax Act, 1961, and whether the assessee was entitled to the relief despite non-claim in the return.

Analysis: The Tribunal noted that the controversy was already covered by coordinate bench decisions holding that compensation received under BSNL VRS-2019 is in the nature of retrenchment compensation and satisfies the requirements for exemption. It further accepted that the assessee had raised the claim before the appellate authority and that the factual matrix and legal position remained unchanged. On that basis, the Tribunal followed the earlier decisions and held that the amount received under the scheme, including leave encashment if any, was entitled to exemption.

Conclusion: The assessee was held entitled to exemption under section 10(10B) on the entire retrenchment compensation received under BSNL VRS-2019 and corresponding relief was directed to be granted.

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