Khushi Ram Yadav, Hisar V. ACIT, Hisar

ITA 1520/DEL/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 6886 (ITAT-DELHI)
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-07-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC 1
• Next Hearing Date: 20-07-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 22-03-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MRS SHAVETA NAKRA DUTTA
• Keywords: Benefit of exemption; Reassessment proceedings
• Section: 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : SMC-I : NEW DELHI BEFORE SHRI R.S. SYAL, ACCOUNTANT MEMBER ITA NO.1520/DEL/2016 ASSESSMENT YEAR : 2011-12 KHUSHI RAM YADAV, 20, INDIRA COLONY, GALI NO.3, OPP. AZAD NAGAR, HISAR. PAN: AACPY7734R VS. ACIT, HISAR. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI V. RAJA KUMAR, ADVOCATE DEPARTMENT BY : MRS. SHAVETA NAKRA DUTTA, SR. DR DATE OF HEARING : 20.07.2016 DATE OF PRONOUNCEMENT : 20.07.2016 ORDER THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER PASSED BY THE CIT(A) ON 23.12.2015 IN RELATION TO T HE ASSESSMENT YEAR 2011-12. ITA NO.1520/DEL/2016 2 2. THE ONLY ISSUE PRESSED BY THE LD. AR IN THIS APP EAL IS AGAINST THE DENIAL OF EXEMPTION IN RESPECT OF THE AMOUNT RECEIV ED BY THE ASSESSEE TOWARDS ARREARS OF GRATUITY AT RS.3,00,000/-. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE WAS AN EMPLOYEE OF CHAUDHARY CHARAN SINGH HARYANA AGRICULT URAL UNIVERSITY, HISAR (HEREINAFTER CALLED CCSU) AND RETIRED FROM SE RVICE BEFORE 24.05.2010. RETURN FOR THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION DECLARING TOTAL INCOME OF RS.11 ,81,304/- WAS FILED, WHICH WAS PROCESSED U/S 143(1) OF THE ACT. THE AO I NITIATED RE- ASSESSMENT PROCEEDINGS ON THE PREMISE THAT THE ASSE SSEE HAD WRONGLY CLAIMED EXEMPTION U/S 10(10) IN RESPECT OF THE ARRE ARS OF GRATUITY. HE OBSERVED THAT GRATUITY WAS EXEMPT UP TO THE LIMIT O F RS.3,00,000/-, WHICH LIMIT STOOD EXHAUSTED IN THE EARLIER YEAR AT THE TIME OF ITS ORIGINAL RECEIPT. HE FURTHER NOTICED THAT EXEMPTION LIMIT W AS ENHANCED TO RS.10 LAC FOR THE PERSONS RETIRING FROM SERVICE ON OR AFT ER 24.5.2010. SINCE THE ASSESSEE RETIRED BEFORE THIS CUT-OFF DATE, THE AO O PINED THAT THE EXTENDED BENEFIT OF EXEMPTION WAS NOT AVAILABLE TO THE ASSES SEE. SINCE THE ITA NO.1520/DEL/2016 3 ASSESSEE WAS AN EMPLOYEE OF CCSU, THE AO HELD THAT SUCH EMPLOYEES COULD NOT BE TERMED AS GOVERNMENT EMPLOYEES AND, HE NCE, THE BENEFIT U/S 10(10)(I) WAS NOT AVAILABLE TO THE ASSESSEE. R ESULTANTLY, HE MADE ADDITION TOWARDS THE AMOUNT OF ARREARS OF GRATUITY RECEIVED AT RS.3,00,000/-. THE LD. CIT(A) ECHOED THE VIEW TAKEN BY THE AO THAT THE ASSESSEE WAS NOT A `HOLDER OF CIVIL POST UNDER THE STATE GOVERNMENT AND HENCE NOT ELIGIBLE FOR EXEMPTION U/S 10(10)(I). FU RTHER, THE ASSESSEE WAS HELD TO BE NOT COVERED U/S 10(10)(II) AS HE DID NOT RECEIVE ANY GRATUITY UNDER THE PAYMENT OF GRATUITY ACT, 1972. THAT IS H OW, HE HELD THAT THE EMPLOYEES OF THE CCSU WERE COVERED U/S 10(10)(III) OF THE ACT, FOR WHICH THERE IS A LIMIT ON THE EXEMPT GRATUITY AMOUN T, WHICH STOOD EXHAUSTED BY THE ASSESSEE IN EARLIER YEAR. SINCE T HE ASSESSEE WAS EMPLOYED BEFORE 24.5.2010, THE NOTIFICATION ISSUED BY THE CBDT ENHANCING THE LIMIT OF RS.10 LAC ON GRATUITY U/S 10 (10)(III) WAS HELD TO BE NOT APPLICABLE. THE ASSESSEE IS AGGRIEVED AGAINST T HE CONFIRMATION OF DENIAL OF EXEMPTION MADE BY THE LD. CIT(A). ITA NO.1520/DEL/2016 4 4. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE RELEVANT MATERIAL ON RECORD. IT IS OBSERVED THAT THE DELHI BENCH OF THE TRIBUNAL IN SHRI RAM KANWAR RANA VS. ITO, WARD-3, HISAR IN ITA NO.1307/DEL/2016 HAS ALLOWED EXEMPTION, INTER ALIA, IN RESPECT OF THE ARREARS OF GRATUITY AND DISMISSED THE GROUNDS ABOUT THE INITIATION OF RE- ASSESSMENT. SIMILAR VIEW HAS BEEN TAKEN IN THE CAS E OF RAGHUBIR SINGH PANGHAL VS. ITO IN ITA NO.1308/DEL/2016. FOLLOWING THE SAME, I EXTEND THE BENEFIT OF EXEMPTION TO THE INSTANT ASSE SSEE ALSO IN RESPECT OF ARREARS OF GRATUITY U/S 10(10)(I). OTHER GROUNDS IN CLUDING THE INITIATION OF REASSESSMENT PROCEEDINGS WERE NOT PRESSED BY THE LD . AR. THE SAME, THEREFORE, STAND DISMISSED AS NOT PRESSED. 5. IN THE RESULT, THE APPEAL IS PARTLY ALLOWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 20.07.201 6. SD/- [R.S. SYAL] ACCOUNTANT MEMBER DATED, 20 TH JULY, 2016. DK ITA NO.1520/DEL/2016 5 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.