1993 (11) TMI 54

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....pplication made under section 256(2) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), seeking a direction to the Tribunal to state a case and refer the following question of law to this court for opinion: "Whether the Appellate Tribunal was right and had valid materials to hold that the ex gratia compensation of Rs. 63,230 received by the assessee consequent on his resignatio....

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....ch under the provisions of clause (3) of section 17 is a profit, in lieu of salary, his income is assessed at a rate higher than that at which it would otherwise have been assessed, the Assessing Officer shall, on an application made to him in this behalf, grant such relief as may be prescribed." "17. (3) 'Profits in lieu of salary', includes (i) the amount of any compensation due to or receive....

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....aced on the words "termination of his employment" occurring in subsection 3(i) of section 17 of the Act. It is necessary to bear in mind that termination of service can take place either by resignation or by dismissal or by compulsory retirement or on attaining superannuation. That being so, we are of the view that there is no justification to confine the meaning of the word "termination" only to ....

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....n holding that the ex gratia compensation of Rs. 63,230, received by the assessee consequent on his resignation, is entitled to the relief under section 89(1) of the Act. It may also be pointed out that if the ex gratia amount received by the assessee by reason of his resignation from employment is not held as falling under clause (3) of section 17 of the Act, it cannot also be construed as An ....