Commissioner Of Income Tax v. Sh. Anand Kumar Jain

ITA No. 270 of 2009 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Commissioner of Income Tax Versus Sh. Anand Kumar Jain ITA No. 270 of 2009 Date of Decision: 18.4.2011 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Ms. Urvashi Dhugga, Senior Standing Counsel,for the appellant.for the appellant. ADARSH KUMAR GOEL, J. 1.This order will dispose of ITA Nos. 125 of 2008 and 270 of2009 as the question involved in both the appeals is common. 2.ITA No. 270 of 2009 has been filed by the revenue underSection 260A of the Income Tax Act, 1961 (in short “the Act”) againstorder dated 5.7.2007 passed by the Income Tax Appellate Tribunal,Chandigarh Bench “B” (hereinafter referred to as “the Tribunal”) in ITANo. 244/CHD/2007 for the assessment year 2004-05, claiming followingsubstantial question of law:- “Whether on the facts and in the circumstances ofthe case and in law, the order of the ITAT is perverseas the ITAT has failed to appreciate the fact that the“Optional Early Retirement Scheme” floated by the employer was not eligible for exemption u/s 10(10C) of the I.T. Act, 1961?” 3.The respondent-assessee was an employee of ReserveBank of India and opted for Voluntary Retirement Scheme during theyear relevant to the assessment year 2004-05. The scheme wascirculated by the Reserve Bank of India vide Circular No. 1 dated11.8.2003. The assessee claimed exemption under Section 10(10C) ofthe Act in respect of the amount received to the extent of Rs.5 lacs.Subsequently, the assessee also claimed relief under Section 89(1) ofthe Act on the balance portion. He claimed that Rule 2BA of the IncomeTax Rules (in short “the Rules”) was applicable. The Assessing Officerallowed relief under Section 89(1) of the Act but did not allow exemptionunder Section 10(10C). On appeal, the CIT (A) upheld the order of theAssessing Officer but on further appeal the plea of the assessee forexemption under Section 10(10C) was accepted by the Tribunal relyingupon the order of Mumbai Bench of ITAT in Vaishali A. Sehlar etc. v.ACIT etc. (ITA No. 6384/M/06 to 5581/M/2006 dated 28[th] March, 2007). 4.We have heard learned counsel for the appellant. 5.Learned counsel for the appellant submits that the schemewas not in accordance with the requirements of Rule 2BA of the Rulesand, therefore, exemption under Section 10(10C) was not applicable. 6.We are unable to accept the submission. 7.The matter with reference to the same scheme wasexamined by the Bombay High Court in Commissioner of Income-Taxv. NageshDevidas Kulkarni [2007] 291 ITR 407 (Bom) and decidedagainst the revenue. 8.In the present case, relief under Section 89(1) has beenallowed by the Assessing Officer. Only question is about applicability ofSection 10(10C) of the Act. A perusal of Section 10(10C) clearlyshows that the amount received by the employees of Public SectorCompany or statutory authority is covered by exemption upto Rs.5 lacs.The very same scheme having been held to be covered by Section 10(10C) of the Act by the Bombay High Court in Nagesh DevidasKulkarni's case (supra) and no contrary view having been shown, wedo not find any reason to take a different view. Accordingly, thequestion has to be answered against the revenue and in favour of theassessee. 9.Both the appeals are dismissed. 10.A photo copy of this order be placed on the file of theconnected case. (ADARSH KUMAR GOEL)JUDGE April 18, 2011gbs (AJAY KUMAR MITTAL)JUDGE