TaxTMI 
TaxTMI 
2026 (7) TMI 564
X X X X Extracts X X X X
X X X X Extracts X X X X
....s the "Act") and relates to Assessment Year (A.Y.) 2020-21. 2. The assessee has taken following grounds in this appeal: "1. The Lrd. CIT Appeal has erred in law and on facts in restricting the exemption in respect of ex gratia compensation received under the BSNL VRS 2019 scheme to Rs. 5,00,000 only by wrongly applying the provisions of section 10 (10C) instead of section 10 (10B) of the Income tax Act 1961. The Lrd. CIT Appeal has failed to appreciate that the compensation received by the appellant is in the nature of compensation on account of involuntary retrenchment and satisfies the conditions prescribed under Rule 2BA and is therefore fully eligible for exemption under section 10(10B) without any monetary ceiling. The impu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....er opportunity of being heard and without ensuring compliance of statutory provisions under section 250 of the Income tax Act 1961. The impugned order is passed in violation of principles of natural justice and is therefore void ab initio and liable to be quashed." 3. The assessee was a salaried employee working with BSNL. The Government introduced a Voluntary Retirement Scheme (VRS), which the assessee opted for and was duly accepted by BSNL. It is submitted that the amount received under the scheme has been disclosed in the return of income, and due tax has been paid, despite the fact that the same was exempt from tax. It is further submitted that the VRS was meant for the retrenchment of senior/old-age employees who were unable to ada....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e assessee. 5. Aggrieved by the order of the Ld.CIT(A), the assessee is in further appeal before us. 6. The Ld. Counsel for the assessee submitted that the amount received by the assessee represented retrenchment compensation received from the Central Government under a scheme approved by the Government. It was submitted that the said amount is fully exempt from tax under section 10(10B) of the Income-tax Act, 1961, and, therefore, the assessee is entitled to full tax exemption. The Ld. Counsel for the assessee further relied upon the following decisions of Coordinate Benches of the ITAT in support of the claim of exemption. "1. ITA No. 42/Chd/2025 AY 2021-22 in the case of Harish Kumar V/s. ITO Chandigarh dated 30.05.2025. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing any exemption, and no rectification or appeal was initiated at that time. The issue on this appeal pertains to exemption u/s 10(10B) of the Income Tax Act The appellant in his written submission has stated that it was only upon learning about the recent judgment of the Hon'ble ITAT Chandigarh, in the case of Harish Kumar vs. ITO Ward 5(5), Chandigarh (ITA No. 42/CHD/2025, dated 30.05.2025), that the Appellant came to know that the compensation received under the BSNL VRS 2019 scheme is eligible for full exemption u/s. 10(10B), subject to Rule 2BA compliance. The grievance raised in the grounds of appeal does not emanate from the order appealed against. It is not a case where the appellant claimed exemption u/s. 10(....