TaxTMI 
TaxTMI 
2026 (9) TMI 436
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...., 2455/PUN/2026, 2456/PUN/2026, 2457/PUN/2026, 2458/PUN/2026, 2459/PUN/2026, 2460/PUN/2026, 2494/PUN/2026, 2495/PUN/2026 Rajkumar Laxman Arenavaru Versus ITO, Ward-13(1), Pune, Purshottam Rajaram Khavanekar Versus ITO, Ward-1, Kudal, Jayant Mahadeo Sawant Versus ITO, Ward-2, Ratnagiri, Janardan Laxman Gund Versus ITO, Ward-12, Pune, Prafulla Eknath Narvekar Versus ITO, Ward-1, Kudal, Shruti Dileep Lad Versus ITO, Ward-1, Ratnagiri, Dhansing Babasaheb Baravkar Versus ITO, Ward-13(1), Pune, Shirish Shankarrao Dhotre Versus ITO, Ward-13(2), Pune, Arun Sadashiv Deokar Versus ITO, Ward-2(1), Nashik, Kishor Natu Badgujar Versus ITO, Ward-1(4), Jalgaon, Shivaji Kalbaji Shinde Versus ITO, Ward-1, Nanded, Vidyadhar Bhupal Kandale Versus ITO, Ward-2(1), Solapur, Usha Ajay Sorte Versus ITO, Ward-2(1), Nashik, Rajendra Shivaji Patil Versus ITO, Circle Sangli, Mohan Waman Borse Versus ITO, Ward-2(1), Nashik, Vivek Manikrao Puranik Versus ITO, Ward-4(2), Pune, Dileep Supadu Borole Versus ITO, Ward-10(1), Pune, Rajaram Ramdas Hiwale Versus ITO, Ward-4(4), Pune, Rashid Ibrahim Pathan Versus ITO, Circle-12, Pune, Santosh Vasantrao Deshpande Versus ITO, Ward-1(1), Aurangabad, Balkrishna Parashram....
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....ion in the case of Prathibha Jagdish Unawane Vs. ITO - ITA No.1117/PUN/2026 and others order dated 29.04.2026 where a consistent view has been taken by the Tribunal holding that alleged sum received by the respective employees from BSNL under the Voluntary Retirement Scheme, 2019 being Retrenchment Compensation is a capital receipt not liable to tax and exempt u/s.10(10B) of the Act. Relevant facts dealt with and finding of this Tribunal reads as under : "2. We have heard both the parties and perused the records. Since common issues have been raised in the above appeals we proceed to adjudicate these appeals by way of this consolidated order for the sake of convenience. All these appeals were heard together with the permission of Ld.AR and Ld.DR. 3. The common issue raised in these bunch of appeals is that whether the amount received from Bharat Sanchar Nigam Limited (BSNL) on account of the forced retirement through the BNSL Voluntary Retirement Scheme, 2019 is in the nature of Retrenchment Compensation and is a Capital receipt not liable to be taxed as per the provisions of section 10(10B) of the Act. 4. Brief facts relating to all the assessee(s) in th....
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.... 6. So far as the claim that the alleged sum received in the form of Retrenchment Compensation from BSNL under the forced retirement is a Capital receipt not chargeable to tax and exemption available u/s.10(10B) of the Act has been decided in favour of the assessee(s), ld. Counsel for the assessee placed reliance in the following decisions: 1. Harish Kumar Vs. ITO (2025) 175 taxmann.com 379 (Chandigarh-Trib.) 2. Dayal Singh Vs. ITO - ITA 519/CHD/2024 3. Suresh Pal Chauhan vs. ITO (2023) 154 taxmann.com 529 (Chandigarh-Trib.) 4. Hindustan Photo Film Workers Welfare Centre Vs. Govt. of India (2017) 79 taxmann.com 298 (Madras) 5. CIT (TDS) Vs. Hindustan Photo Film Workers Welfare Centre (2021 129 taxmann.com 356 (Madras) 6. Union of India Vs. M/s. Hindustan Photo Film Workers Welfare Centre and others _ Special Leave Petition (Civil) Diary No.37247/2017 7. Shree Rajeshwar Sharma Vs. ITO - ITA No.870/CHD/2018 8. CIT Vs. Mahalakshmi Textile Mills Ltd.(1967) 66 ITR 710 (SC) 9. PCIT Vs. Karnataka State Cooperative Federation Ltd. (2021) 128 taxmann.com 1 (Karnataka) 10. CIT Vs. Pruthvi Brokers....
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....calculated in accordance with the provisions of clause (b) of section 25F of the Industrial Disputes Act, 1947 (14 of 1947); or [(ii) such amount, not being less than fifty thousand rupees, as the Central Government may, by notification 79 in the Official Gazette, specify in this behalf,] whichever is less : Provided further that the preceding proviso shall not apply in respect of any compensation received by a workman in accordance with any scheme which the Central Government may, having regard to the need for extending special protection to the workmen in the undertaking to which such scheme applies and other relevant circum- stances, approve in this behalf.] Explanation.-For the purposes of this clause- (a) compensation received by a workman at the time of the closing down of the undertaking in which he is employed shall be deemed to be compensation received at the time of his retrenchment; (b) compensation received by a workman, at the time of the transfer (whether by agreement or by operation of law) of the ownership or management of the undertaking in which he is employed from the employer in relation to that undertaking to a new e....
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....alf; or 3[(bb) termination of the service of the workman as a result of the non-renewal of the contract of employment between the employer and the workman concerned on its expiry or of such contract being terminated under a stipulation in that behalf contained therein; or] (c) termination of the service of a workman on the ground of continued ill-health;]" 12. In BSNL VRS-2019, the separation was triggered by the employee's "Option." In retrenchment, the employer triggers the exit unilaterally. The law says "A is not B." The Tribunals' interpretation is that "A is B" because the employer was in financial distress. In BSNL VRS-2019, the employee exercised a "Voluntary Option" on a portal. This mutuality removes the stigma of retrenchment. 8. We are of the considered opinion that Ld.CIT(A) should have condoned the delay as assessee had filed elaborate explanation regarding delay and there was sufficient cause for delay. These Assessees have filed Returns of Income based on professional Advice received at that point of time. However, subsequently they made revised claim before CIT(A). 8.1 Substantial justice is more important than the proced....
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..../CHD/2025, dated 30.05.2025) that the assessee became aware that the compensation received under the BSNL VRS-2019 scheme is eligible for exemption under section 10(10B), subject to compliance with Rule 2BA. 4. Aggrieved by the orders of the Assessing Officer, the assessee carried the matter in appeal before the Ld.CIT(A), who dismissed the appeal of the assessee as non maintainable by observing as follows: "...In the present case, the delay in filing of the appeal is almost four years which is an inordinate and huge delay. Moreover, as has been elaborately discussed above, the appellant has also failed to provide any reasonable ground that could assist the first appellate authority to draw sufficient cause for the inordinate delay of 1,396 days in filing of this appeal. The inordinate delay in the present case, if condoned, would make the term ''Sufficient cause" in section 249(3) of the Income Tax Act, 1961 hollow and meaningless. 20. In light of the facts of the case, provisions of the Income Tax Act, 1961 and judicial decisions in the matter as discussed above, I am constrained to conclude that the appellant has failed to submit any reasonable ground ....
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....s order, assessee(s) are directed to place revised computation of income before the respective Jurisdictional Assessing Officers claiming the exemption u/s.10(10B) of the Act as discussed (supra) and thereafter the Revenue authorities shall grant the refund (if any) entitled to the assessee(s) after due verification of such revised computation of income. Impugned findings of ld.CIT(A) are set aside. Common issue raised in the Grounds of appeal raised by respective assessee(s) stands allowed." 9. Since the facts in the instant bunch of appeals are same, therefore, following the same parity of reasoning, I hold that the alleged sum received under BSNL Voluntary Retirement 2019 Scheme is in the nature of Retrenchment Compensation received by the assessee(s) in appeal and such compensation falls under the provisions of section 10(10B) of the Act and not u/s.10(10C) of the Act and is in the nature of Capital receipt exempt from tax. Assessee(s) are directed to place revised computation of income before the respective Jurisdictional Assessing Officers claiming the exemption u/s.10(10B) of the Act of the alleged sum and thereafter the Revenue authorities shall compute the tax lia....
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....der 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 dislocation, and the hyper technical interpretations based on technicalities about the wordings in the settlement deed, signed by him under these compelling circumstances, is being taken as the understanding about assessee's actual conduct; that is too pedantic an approach and it cannot meet our approval. Let us also not forget that while taking calls on these issues, which deal with employees in the lower rung of hierarchy, we must not be too pedantic or hyper technical in approach. We have to be pragmatic in approach and we must give full effect to the true intent of ....