A.R. Arunachalam, Trichy V. ITO, Trichy

ITA 1447/CHNY/2012

• Counselvise Citation: 144721714 RSA 2012
• Duration Of Justice: 3 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 30-10-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 04-07-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GURU BASHYAM IRS
• Assessee Lawyers: S KEERTHIRAJAN
• Keywords: Benefit of exemption; Condonation of delay
• Section: 143(3)

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL C BENCH, CHENNAI. BEFORE DR. O.K. NARAYANAN, VICE-PRESIDENT & SHRI S.S. GODARA, JUDICIAL MEMBER I.T.A. NO.1447 /MDS/2012 ASSESSMENT YEAR : 2004-05 SHRI A.R. ARUNACHALAM, A-3, AL MAAJESTIC APARTMENTS, KATHIRESAN NAGAR LINGAM NAGAR, KULUMANI ROAD, MELA PANDAMANGALAM, TRICHY 620 102. [PAN:ACYPA2528H] VS. THE INCOME TAX OFFICER, WARD II(2), TRICHY. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S. KEERTHIRAJAN, C.A. RESPONDENT BY : SHRI GURU BASHYAM, IRS, JCIT DATE OF HEARING : 30.10.2012 DATE OF PRONOUNCEMENT : 30.10.2012 ORDER PER S.S. GODARA, JUDICIAL MEMBER THIS ASSESSEES APPEAL HAS BEEN PREFERRED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), TIRUCHIRAPPAL LI DATED 19.10.2005 IN ITA NO. 394/05-06 FOR THE ASSESSMENT YEAR 2004-05 I N PROCEEDINGS UNDER SECTION 143(3) OF THE INCOME TAX ACT 1961 [IN SHORT THE ACT]. 2. IN THIS APPEAL, THE ASSESSEE HAS FILED A CONDON ATION PETITION IN THE SHAPE OF AFFIDAVIT SEEKING CONDONATION OF 2652 DAYS IN FILING THE APPEAL. DURING THE COURSE OF HEARING AS WELL, THE AR REPRES ENTING ASSESSEE HAS I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1 11 1447 447447 447/M/ /M/ /M/ /M/12 1212 12 2 REFERRED TO THE AFFIDAVIT AND SUBMITTED THAT THE DE LAY IN FILING THE APPEAL HAS BEEN DULY EXPLAINED, WHICH WAS BEYOND THE ASSESSEE S CONTROL SINCE THE CHARTERED ACCOUNTANT, WHO HAD BEEN ENGAGED DID NOT FILE THE APPEAL ON TIME, WHICH COMPELLED THE ASSESSEE TO ENGAGE ANOTHE R CHARTERED ACCOUNTANT. IN THE LIGHT THEREOF, IT IS THE SUBMISS ION OF THE AR THAT THE DELAY CAUSED IN INSTITUTING THE PRESENT APPEAL IS NEITHER INTENTIONAL NOR DELIBERATE. HENCE, HE PRAYED FOR CONDONATION OF DELAY IN FILING THE APPEAL. 3 THE DR REPRESENTING REVENUE DID NOT SERIOUSLY CO NTEST THE PETITION SEEKING CONDONATION OF DELAY AND COULD NOT OPPOSE T HE CONTENTS OF THE AFFIDAVIT. 4 WE HAVE HEARD BOTH PARTIES QUA THE ASPECT OF COND ONATION OF DELAY IN FILING (SUPRA). ADMITTEDLY, THE ASSESSEE IS A FORME R EMPLOYEE OF ICICI BANK, WHO OPTED FOR EARLY RETIREMENT SCHEME. AS HIS AFFID AVIT SUGGESTS, HE ENGAGED A C.A. WHO DID NOT PURSUE THE MATTER. THE S OLEMN AVERMENTS IN THE AFFIDAVIT ABOVE SAID HAVE ALSO NOT BEEN CONTROVERTE D BY THE REVENUE. THEREFORE, WE ARE OF THE OPINION THAT THE ASSESSEE HAS BEEN ABLE TO SATISFACTORILY EXPLAIN THE DELAY OF 2652 DAYS IN FI LING THE APPEAL. ACCORDINGLY, THE SAME STANDS CONDONED. 5. ON MERITS, WE NOTICE THAT THE ONLY ISSUE IS THA T THE ASSESSEE, WHO OPTED FOR EARLY RETIREMENT SCHEME FROM HIS EMPLOYER ICICI BANK, HAD I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1 11 1447 447447 447/M/ /M/ /M/ /M/12 1212 12 3 CLAIMED RELIEF OF EXEMPTION UNDER SECTION 10(10C) A S WELL AS SECTION 89(1) OF THE ACT QUA THE EX GRATIA PAYMENT RECEIVED FROM T HE EMPLOYER. ALTHOUGH HIS CLAIM UNDER SECTION 89(1) OF THE ACT WAS ACCE PTED BY THE ASSESSING OFFICER IN ASSESSMENT PROCEEDINGS, BUT THE SAME UND ER SECTION 10(10C) WAS DECLINED THROUGH ASSESSMENT ORDER DATED 04.02.2005. IN APPEAL AS WELL, THE CIT(A) HAS HELD THAT THE EARLY RETIREMENT SCHEME OF THE ICICI BANK WAS NOT IN CONFORMITY WITH THE GUIDELINES OF RULE 2BA READ WITH SECTION 10(10C) OF THE ACT. THEREFORE, THE ASSESSEE IS AGGRIEVED. 6. BEFORE US, THE AR HAS VEHEMENTLY ARGUED THAT TH E ISSUE IN HAND IS NO MORE RES INTEGRA AS THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF K.R. ALAGAPPAN AND OTHERS VS. ACIT [2011] 332 ITR 517 HA S HELD THAT THE EMPLOYEES OF ICICI BANK, WHO PROCEEDED ON EARLY RET IREMENT ARE ENTITLED FOR THE BENEFIT OF EXEMPTION UNDER SECTION 10(10C). FUR THER, HE HAS ALSO CITED COORDINATE BENCH DECISION OF THE ITAT IN I.T.A. NO. 2158/MDS/2011 DATED 28.03.2012 TITLED AS SMT. M. MEYYAMMAI V. DCIT AND PRAYED FOR ACCEPTANCE OF THE APPEAL. 7. THE DR REPRESENTING THE REVENUE OPPOSED THE ARG UMENT BY PLACING RELIANCE ON THE CIT(A)S ORDER CONFIRMING THE FINDI NGS OF THE ASSESSING OFFICER. 8. WE HAVE HEARD BOTH PARTIES AT LENGTH AND HAVE A LSO PERUSED THE CASE I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1 11 1447 447447 447/M/ /M/ /M/ /M/12 1212 12 4 LAW CITED. THE ONLY ISSUE BETWEEN THE PARTIES IS TH AT THE ASSESSEES CLAIM OF EXEMPTION UNDER SECTION 10(10C) QUA PAYMENT RECEIVE D UNDER EARLY RETIREMENT SCHEME OF ICICI BANK HAS BEEN DECLINED B Y THE ASSESSING OFFICER AS WELL AS CIT(A) ON THE GROUND THAT THE SAME IS NO T COVERED BY RULE 2BA. THE FACTS ARE NOT IN DISPUTE BEFORE US. ON THE ISSU E ABOVE SAID, WE NOTICE THAT THE HONBLE JURISDICTIONAL HIGH COURT WHILST C ONSIDERING THE CASES FILED BY THE EMPLOYEES OF ICICI BANK ITSELF IN THE ABOVE TITLED CASE HAS BEEN PLEASED TO HOLD AS UNDER: IN THIS CASE, IT IS ADMITTED THAT THERE WERE CONFL ICT OF VIEWS REGARDING THE EXEMPTION TO BE GRANTED UNDER SECTION 10(10C) OF THE INCOME-TAX ACT IN RESPECT OF THE AMOUNTS RECEIVED U NDER THE VOLUNTARY RETIREMENT SCHEME AND THEREFORE, WHILE PASSING THE ORDER UNDER SECTION 143 OF THE INCOME-TAX ACT, THE INCOME-TAX O FFICER DID NOT DEAL WITH SECTION 10(10C) OF THE ACT REGARDING EXEMPTION AND AS RIGHTLY POINTED OUT BY THE LEARNED COUNSEL APPEARING FOR TH E PETITIONERS AS WELL AS THE LEARNED STANDING COUNSEL APPEARING FOR THE R ESPONDENT THAT THE DIVISION BENCH OF THIS COURT ALSO HELD IN THE JUDGM ENT REPORTED IN CIT V. M. CHELLADURAI [2009] 317 ITR 370 (MAD) REFERRED TO ABOVE HELD THAT EXEMPTION UNDER SECTION 10(10C) OF THE ACT CAN NOT BE CLAIMED BY THE EMPLOYEES OF THE ICICI BANK, WHO OPTED TO RETIR E UNDER THE VOLUNTARY RETIREMENT SCHEME OF THAT BANK. THEREFORE , THE RESPONDENT WAS RIGHT IN REJECTING THE APPLICATION FOR RECTIFIC ATION ON THE GROUND THAT THERE IS NO ERROR APPARENT ON THE FACE OF THE RECORD AND IT IS A DEBATABLE ONE. HOWEVER, HAVING REGARD TO THE SUBSEQ UENT DEVELOPMENT VIZ., THE JUDGMENT DELIVERED BY THE HONOURABLE SUPR EME COURT IN CIVIL APPEALS NOS. 6997 TO 7002 OF 2009 (CHANDRA RANGANAT HAN V. CIT [2010] 326 ITR 49 (SC) WHICH WERE AGAINST THE ORDER OF THE DIVISION BENCH OF THIS COURT REFERRED TO ABOVE, THE HONOURAB LE SUPREME COURT HELD THAT THE ASSESSEES ARE ENTITLED TO CLAIM EXEMP TION UNDER SECTION 10(10C) OF THE ACT. HENCE, THE MATTER HAS BEEN FINA LLY DECIDED BY THE HONOURABLE SUPREME COURT AND THEREFORE, THE ASSESSE ES VIZ., THE PETITIONERS HEREIN, ARE ENTITLED TO CLAIM EXEMPTION UNDER SECTION 10(10C) OF THE INCOME-TAX ACT AND THEREFORE, THE OR DER OF THE RESPONDENT, REJECTING THE APPLICATIONS FOR RECTIFIC ATION OF THE ASSESSMENT ORDER IS SET ASIDE. I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1 11 1447 447447 447/M/ /M/ /M/ /M/12 1212 12 5 SIMILARLY, THE CHENNAI BENCH OF ITAT IN THE ABOVE S AID CASE (SUPRA) HAS ALSO UPHELD THE CLAIM OF AN EMPLOYEE OF ICICI BANK BY HOLDING THAT SHE IS ENTITLED FOR THE BENEFIT OF SECTION 10(10C). THE RE VENUE HAS NOT BEEN ABLE TO DISTINGUISH THE FACTS OF THE INSTANT CASE VIS--VIS THE CASE LAW CITED ABOVE. ACCORDINGLY, WE ARE OF THE OPINION THAT THE CIT(A) HAS ERRED IN CONFIRMING REJECTION OF ASSESSEES CLAIM UNDER SECTION 10(10C) OF THE ACT, MADE BY THE ASSESSING OFFICER. THEREFORE, WE ACCEPT THE INS TANT APPEAL AND DIRECT THE ASSESSING OFFICER TO ALLOW DEDUCTION UNDER SECTION 10(10C) AS CLAIMED BY THE ASSESSEE. 9. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING ON TUESDAY, THE 30 TH OF OCTOBER, 2012 AT CHENNAI. SD/- SD/- (DR. O.K. NARAYANAN) VICE-PRESIDENT (S.S. GODARA) JUDICIAL MEMBER CHENNAI, DATED, THE 30.10.2012 VM/- TO: THE ASSESSEE//A.O./CIT(A)/CIT/D.R.