TaxTMI 
TaxTMI 
2026 (6) TMI 1269
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....eceiving pension from the Government of India in accordance with the applicable pension rules. 3. For assessment year 2020-21, he filed his return of income on 25 December 2020 based on Form 16 issued by the employer, declaring total income of Rs.11,80,500. During the relevant year, he received ex gratia of Rs.10,29,053. However, the employer restricted the exemption under section 10(10C) to Rs.5,00,000, instead of allowing the full amount claimed as exempt under the second proviso to section 10(10C). The return was processed on 28 August 2021 without granting full exemption, which, according to the assessee, ought to have been allowed. 4. The assessee preferred an appeal before the learned CIT(A), contending that the disallowance of exemption amounting to Rs.5,29,053 should be deleted. Since the appeal was filed belatedly, the assessee also sought condonation of delay on the grounds of appeal. 5. The learned CIT(A) noted that the intimation under section 143(1) was issued on 28 August 2021 and that the appeal ought to have been filed on or before 27 September 2021. Since it was filed only on 9 December 2025, there was a delay of 1438 days. The assessee explained that the ....
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....tical facts and circumstances. He contended that those decisions ought to be followed and that the assessee should be granted the claimed deduction. He also pointed out that several Commissioners of Income Tax (Appeals) have granted similar relief to other assessee's. 12. We have carefully considered the rival submissions and perused the order of the Coordinate Bench in the case of Pratibha Jagdish Unawake, wherein the issue was considered as follows: the common question in that group of appeals was whether the amount received from Bharat Sanchar Nigam Limited (BSNL) on account of forced retirement under the BSNL Voluntary Retirement Scheme, 2019, was in the nature of retrenchment compensation and, therefore, a capital receipt not chargeable to tax under section 10(10B) of the Act. 13. The Coordinate Bench decided the issue as under: "4. The core of this dispute rests on whether a tax tribunal can transform a voluntary exit from a reviving entity into an involuntary retrenchment from a dying one. It is submitted that these rulings have not appreciated the primary distinction between a "Going Concern" in revival and an undertaking in liquidation. 5. Section 1....
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....he transfer; 80(c) the expressions "employer" and "workman" shall have the same meanings as in the Industrial Disputes Act, 1947 (14 of 1947);]" 6. The appellants consistently rely on HPF case. However, HPF and BSNL represent two opposite poles of corporate existence. In HPF, the Hon'ble Madras High Court was dealing with a company that had officially ceased operations. Para 6 of the decision of the Hon'ble Madras High Court is reproduced herewith: 6."The Government of India decided to close down the company... For specific purpose of enabling employees to come out of financial crisis, Government approved a non- budgetary support... same being compensation under section 10(10B) would be exempted." 7. However, the BSNL facts are different. As per the Cabinet Note dated 29.10.2019, the BSNL scheme was part of a "Revival Package" involving 4G spectrum allotment and debt restructuring.) 11. The Tribunals in Harish Kumar (Chandigarh) and Rajendra Patil (Pune) have erroneously held that the BSNL VRS was "Retrenchment in the garb of VRS" due to financial stress. Section 10(10B) imports the definition of "Retrenchment" from Section 2(oo)....
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.... Quote, "15. Further, I find the Coordinate Bench, Ahmedabad in the case of Jayeshkumar Tulsidas Sutaria Vs. ITO (supra) following the decision of Coordinate Bench, Chandigarh in the case of Harish Kumar vs. ITO Ward- 5(5), Chandigarh -ITA No. 42/CHD/2025 order dated 30.05.2025 has decided the issue in favour of the assessee by observing as under : "3. The assessee was employed with Bharat Sanchar Nigam Limited (BSNL), a Government of India enterprise. BSNL notified the Voluntary Retirement Scheme (VRS) 2019 on 04.11.2019, which was duly approved and implemented by the employer. The assessee opted for the scheme and accordingly received compensation under the VRS, as per the terms laid down by BSNL. It is submitted that the assessee had not been paid regular salary for several months prior to opting for the scheme and was under severe financial and professional uncertainty. In view of these circumstances, the assessee opted for the scheme as a measure of financial security. The compensation received by the assessee was in the nature of compensation under the BSNL VRS-2019 scheme. The compensation amount received under the scheme was offered to tax in the return of income ....
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....wareness of the legal provisions at the time of filing the return of income, the assessee inadvertently offered the compensation received under BSNL VRS-2019 to tax. Subsequently, based on the decision of the Hon'ble ITAT Chandigarh Bench in Harish Kumar vs. ITO Ward 5(5), Chandigarh (ITA No. 42/CHD/2025 dated 30.05.2025), wherein compensation under the same BSNL VRS-2019 scheme was held to be exempt under section 10(10B), the assessee now seeks exemption of such compensation. We find that the assessee filed theclaim before the Ld. CIT(A)and since the income of the assessee is not taxable, the assessee is eligible for the refund of the TDS. 8. In the result, both the appeals of the assessee are allowed." 16. The contention of ld. DR that only a 'workman' as defined under the Act is eligible for benefit u/s. 10(10B) of the Act has no force as the Hon'ble High Court of Madras in the case of Hindustan Photo Film Workers Welfare Centre vs. Govt. of India (2018) 400 ITR 299 (Madras) has held that benefit u/s. 10(10B) would be applicable to all employees covered by the scheme. 17. In light of the above decisions which are squarely applicable on ....
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....tted by Ld.AR that in these cases the Department has not filed any appeal. Ld.DR has not rebutted it. Thus, it is observed that CIT(A)'s have been taking different stand on identical issues. Consistency in judicial decisions is very important. 12. We have perused the submission of the Ld.DR. Ld. DR has not brought on record any contrary decision of Hon'ble High Court. We also find support from the decision of ITAT Ahmedabad in the case of Vishnu Mohan T Nair v. Income Tax Officer, [ 2018] 61 ITR(T) 796 (Ahmedabad- Trib.), the operative portion of the said order is extracted below: "While on this subject, it is also useful to take note of Hon'ble Supreme Court's judgment in the case of Mahendra Singh Dhantwal v. Hindustan Motors Ltd. [1985] 20 Taxman 1/152 ITR68, wherein compensation in lieu of reinstatement was treated as eligible for retrenchment compensation under section 10(10B). To us, the takeaway from this judgment seems to be that it is not the form but the substance that matters so far definition of retrenchment compensation is concerned. Right now we are dealing with an employee who is giving up his source of livelihood under the threat of....