2025 (10) TMI 33

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....titled for deduction u/s 10(10A) of the Income Tax Act, 1961 amounting to Rs. 34,01,898/-. 3. The brief facts of the case are that assessee has originally filed his return of income on 03.08.2013 declaring an income of Rs. 1,38,06,938/-. This return was revised on 16.08.2014 declaring an income of Rs. 1,04,05,040/-. Thus, assessee has claimed exemption u/s 10(10A) of the Income Tax Act amounting to Rs. 34,01,898/-. The AO has passed the assessment order u/s 143(3) and did not allow the claim of the assessee u/s 10(10A). The assessee did not challenge this action of the AO in appeal, rather, on coming to know an order of ITAT, Chandigarh Bench in similar case of Shri Anil Suri and Shri Dharam Singh Rawat, who also retired from Ranbaxy Lab....

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.... b) Whether there was an apparent error in the order of the AO vide which such claim was denied and it could be rectified u/s 154 of the Income Tax Act? 6. As far as the first fold of contention is concerned, we take note of relevant part of Section 10(10A) of the Income Tax Act, which reads as under : (10A) (i)..; (ii) any payment in commutation of pension received under any scheme of any other employer, to the extent it does not exceed- (a) in a case where the employee receives any gratuity, the commuted value of one-third of the pension which he is normally entitled to receive, and (h) in any other case, the commuted value of one-half of such pension, such commuted value being determined ha....

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....utation of pension received under any scheme of any other employer to the extent it does not exceed. So, there was no other restriction. Thus, assessee is entitled for exemption u/s 10(10A) of the Income Tax Act. 7.1 The second question arose whether it is an apparent error which can be rectified u/s 154 of the Income Tax Act. The power of rectification u/s 154 of the Income Tax Act can be exercised only when the mistake which is sought to be rectified is an obvious and patent mistake which is apparent from the record and not a mistake which requires to be established by arguments and a long- drawn process of reasoning on points on which there may conceivably be two opinions. The ld. counsel for the assessee has placed on record large nu....

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....e to him under the provisions of the Income-tax Act. he is not entitled to get that relief. It is the duty of the ITO and other officers administering the Act to inform the assessee that he is entitled to a particular relief if it is apparent that he is so entitled from the material available in the proceedings of assessment. This duty as been highlighted by a circular issued by the CBR. For these reasons, the Gujarat High Court in Chokshi Metal Refinery v. CIT [1977] 107 ITR 63 (Guj.), dissented from the view taken by the Allahabad High Court in the aforesaid cases and held that if it is apparent from the record of assessment that the assessee was entitled to a particular relief, the ITO can rectify that mistake under section 154 although ....