TaxTMI 
TaxTMI 
2023 (10) TMI 1509
X X X X Extracts X X X X
X X X X Extracts X X X X
....lore. 2. In this appeal, the assessee has raised following grounds: - "1. That the order of Ld. CIT(A), NFAC, Delhi denying the exemption claimed u/sec. 10(10AA)(ii) upto Rs. 17, 68, 479/- and restricting the same to Rs. 3, 00, 000/-. 2. That assessee is a Rajasthan State Government owned company employee. 3. Any other matter with prior permission of the chair." 3. Succinctly, the fact as culled out from the records is that CPC/AO passed intimation u/s 143(1) of the Act on 19.10.2021 wherein the CPC added a sum of Rs. 14, 68, 480/- not allowing benefit to the assessee u/s 10(10AA) of the Act contending that deduction is available to the extent of Rs. 3, 00, 000/- only and therefore, the a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....0, 000.00 u/sec. 10(10AA) was allowed to Rs. 17, 68, 479.00 on 07.12.2022 by ADIT, CPC, Bangalore. (4) In between assessee also filed appeal CIT (A) NFAC for order u/sec. 143(1) of Act. (5) The LD. CIT (A) NFAC, after going into details, documents as held that "As the appellant was not a State Government Employee as on 31.07.2019 the deduction claimed by the Appellant is eligible for deduction u/sec. 10(10AA)(ii) of the Income Tax Act & not u/sec. 10(10AA)(i). Whereas the law is very clear. (a) Therefore it is hereby held that the appeal filed by the appellant claiming deduction for Rs. 17, 68, 479.00 u/sec. 10(10AA)(i) of the Income Tax Act is devoid of merit and the same is hereby DISMISSED. G....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... in the behalf to the employees of that government. It is clear from the above rule that the exemption, in respect of the amount of leave encashment for the employees covered under sub - clause 2, is allowed by CBDT up to the limit of Central Government employees. Gazette notification is only a medium to inform the limit of leave encashment entitlement of the government employee. The importance of gazette notification is not more than that. The gazette notification is into determining the exemption limit because the exemption limit has been clearly specified in the above rule which stipulates the exemption limit for all non - government. Employees to be equal to the limit of government employees. Since beginning t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ent employees to be equal to the limit of Government Employees Since the Cabinet Secretary has been getting the highest salary in Government; hence this should be entitlement of leave encashment by all non employees too. Though the CBDT has issued a press release dated 25.05.2023 in form of notification no. 31/2023 dated 24.05.2023 where the limit of Rs. 3.00 lakh u/sec. 10(10AA)(ii) has been raised to Rs. 25.00 lakhs w.e.f. 01.04.2023. There is no link for the period 01.04.2022 to 31.03.2023 & back where there is no such notification. (Copy enclosed) The explanatory memorandum to this notification has further clarified that "No person is being adversely affected by giving retrospective effect to this no....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the material placed on record. The bench noted that the assessee relying the decision of Hon'ble Delhi High Court has issued a notice to the Union of India in the case of Kamal Kumar Kalia & Ors. Vs. Union of India & Ors in WP(C) 11846/2019 dated 08.11.2019 wherein the court has given following directions :- "8. We are however of the, prima facie, view that the grievances of the petitioner with regard to exemption limit under Clause (ii) of Section 10 (10AA) not being raised since 1998, appears to be justified. This is so because over the decades, the pay-scales admissible to government servants, and even employees of the Public Sector Undertaking and Nationalised Banks and all others have been upwardly revised, keeping in view, t....