TaxTMI 
TaxTMI 
2006 (3) TMI 101
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....eld that the amount receivable by the assessee on his voluntary retirement was worked out on the basis of a scheme which was not in consonance with the requirements specified in rule 2BA(vi) of the Rules and was, therefore, not allowable. Feeling aggrieved, the appellant preferred an appeal before the Commissioner of Income-tax (Appeals), who deleted the addition by making the following observations: "2.3 I have considered the contentions of the Assessing Officer and the claim of the appellant. Rule 2BA(vi) prescribes that the amount receivable on voluntary retirement should not exceed (a) the amount equivalent to 3 months' salary for each completed year of service or (b) the amount equivalent to salary at the time of retirement multiplied by the balance months of service left. The provisions do not lay down that the amount representing the lower of the two specified limits (being the amounts equivalent to 3 months' salary for each completed year of service or monthly emoluments at the time of retirement multiplied by the balance months of service left before the date of retirement on superannuation) would be eligible for exemption. Hence, the amounts received would be eligible f....
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....r receivable by an employee of- (i) a public sector company; or (ii) any other company; or (iii) an authority established under a Central, State or Provincial Act; or (iv) a local authority; or (v) a co-operative society; or (vi) a University established or incorporated by or under a Central, State or Provincial Act and an institution declared to be a University under section 3 of the University Grants Commission Act, 1956 (3 of 1956); or (vii) an Indian Institute of Technology within the meaning of clause (g) of section 3 of the Institutes of Technology Act, 1961 (59 of 1961); or (viia) any State Government; or (viib) the Central Government; or (viic) an institution, having importance throughout India or in any State or States, as the Central Government may, by notification in the Official Gazette, specify in this behalf; or (viii) such institute of management as the Central Government may, by notification in the Official Gazette, specify in this behalf, on his voluntary retirement or termination of his service, in accordance with any scheme or schemes of voluntary retirement or in the case of a public sector company referred to in sub-clause (i), a scheme of voluntary....
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....loyees (by whatever name called) including workers and executives of a company or of an authority or of a cooperative society, as the case may be, excepting directors of a company or of a co-operative society; (iii) the scheme of voluntary retirement or voluntary separation has been drawn to result in overall reduction in the existing strength of the employees; (iv) the vacancy caused by the voluntary retirement or voluntary separation is not to be filled up; (v) the retiring employee of a company shall not be employed in another company or concern belonging to the same management; (vi) the amount receivable on account of voluntary retirement or voluntary separation of the employee does not exceed the amount equivalent to three months' salary for each completed year of service or salary at the time of retirement multiplied by the balance months of service left before the date of his retirement on superannuation." A conjoint and meaningful reading of the provisions of section 10(10C) of the Act and rule 2BA(vi) of the Rules makes it clear that the provisions of rule 2BA(vi) of the Rules would be applicable to an assessee who is in receipt of the sum from the employer on volunta....
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....ths' salary for each completed year of service, or (2) salary at the time of retirement, multiplied by the balance months of service left before the date of retirement of an employee on his superannuation, several employees of several companies would be adversely affected without any fault on their part and the scheme of voluntary retirement would be of no benefit to them. Such a construction is not called for having regard to the provisions of section 10(10C) of the Act. The payment of amount contemplated under the Voluntary Retirement Scheme framed by the Reliance Industries Limited does not exceed the amount equivalent to (1) three months salary for each completed year of service, or (2) salary at the time of retirement multiplied by the balance months of service left before the date of his retirement on superannuation. Under the circumstances, it will have to be held that the scheme of voluntary retirement from service framed by the Reliance Industries Limited conforms to the guidelines prescribed in rule 2BA of the Rules. Therefore, the substantial question of law framed earlier vide order dated January 31, 2006, is answered in the affirmative. As this court has come to the c....