Sri Anupam Biswas, Kolkata V. ITO, Ward-27(2), Kolkata, Kolkata

ITA 2198/KOL/2014

• Counselvise Citation: 219823514 RSA 2014
• Duration Of Justice: 1 year(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2015
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2004-2005
• Appeal Filed On: 08-12-2014
• Court: TRIBUNAL
• Department Lawyers: SUDIPTA GUHA
• Assessee Lawyers: MANOJ TIWARI
• Keywords: Reasonable cause; Condonation of delay
• Section: 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH SMC, KOLKATA [BEFORE HONBLE SHRI N.V.VASUDEVAN, JM] ITA NO.2198/KOL/2014 ASSESSMENT YEAR : 2004-05 SRI ANUPAM BISWAS -VERSUS- I.T.O., WARD-27(2), KOLKATA KOLKATA (PAN:ADPPB 6211 N) (APPELLANT ) (RESPONDENT) FOR THE APPELLANT : SHRI MANOJ TIWARI, FCA FOR THE RESPONDENT : SHRI SUDIPTA GUHA, JCIT DATE OF HEARING : 03.12.2015. DATE OF PRONOUNCEMENT : 09.12.2015. ORDER THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 16.12.2009 OF CIT(A)-XIV, KOLKATA RELATING TO A.Y.2004-05. 2. THE ASSESSEE IS AN EMPLOYEE OF RESERVE BANK OF I NDIA, (RBI) WHO OPTED FOR VOLUNTARY RETIREMENT UNDER THE OPTIONAL EARLY RETI REMENT SCHEME (OERS). DURING THE PREVIOUS YEAR RELEVANT TO AY 2004-05, THE ASSES SEE RECEIVED A SUM OF RS.5,99,924/- ON RETIREMENT UNDER OERS. THE ASSESSE E FILED A RETURN OF INCOME FOR AY 2004-05 DECLARING TOTAL INCOME OF RS.4,04,672/- ON 15.10.2004 CLAIMING EXEMPTION U/S.10(10C) OF THE INCOME TAX ACT, 1961 ( ACT). SEC.10(10C) OF THE ACT READS THUS: SECTION 10(10C) READS AS UNDER : ANY AMOUNT RECEIVED OR RECEIVABLE BY AN EMPLOYEE OF (I) A PUBLIC SECTOR COMPANY; OR (II) ANY OTHER COMPANY; OR (III) AN AUTHORITY ESTABLISHED UNDER A CENTRAL, STA TE OR PROVINCIAL ACT; OR ITA NO.2198/KOL/2014 SRI ANUPAM BISWAS. A.YR.2004-05 2 (IV) A LOCAL AUTHORITY; OR, (V) A CO-OPERATIVE SOCIETY; OR (VI) A UNIVERSITY ESTABLISHED OR INCORPORATED BY OR UNDER A CENTRAL, STATE OR PROVINCIAL ACT AND AN INSTITUTION DECLARED TO BE A UNIVERSITY UNDER SECTION 3 OF THE UNIVERSITY GRANTS COMMISSION ACT, 1956 (3 OF 1956); OR (VII) AN INDIAN INSTITUTE OF TECHNOLOGY WITHIN THE MEANING OF CLAUSE (G) OF SECTION 3 OF THE INSTITUTES OF TECHNOLOGY ACT, 1961 (59 OF 1961) ; OR (VIIA) ANY STATE GOVERNMENT; OR (VIIB) ANY CENTRAL GOVERNMENT; OR (VIIC) AN INSTITUTION, HAVING IMPORTANCE THROUGHOUT INDIA OR IN ANY STATE OR STATES, AS THE CENTRAL GOVERNMENT MAY, BY NOTIFICATION IN OFFI CIAL GAZETTE, SPECIFY IN THIS BEHALF; OR (VIII) SUCH INSTITUTE OF MANAGEMENT AS THE CENTRAL GOVERNMENT MAY, BY NOTIFICATION IN THE OFFICIAL GAZETTE, SPECIFY IN THIS BEHALF, ON HIS VOLUNTARY RETIREMENT OR TERMINATION OF HIS S ERVICE, IN ACCORDANCE WITH ANY SCHEME OR SCHEMES OF VOLUNTARY RETIREMENT OR IN THE CASE OF A PUBLIC SECTOR COMPANY REFERRED TO IN SUB-CLAUSE (I), A SCHEME OF VOLUNTAR Y SEPARATION, TO THE EXTENT SUCH AMOUNT DOES NOT EXCEED FIVE LAKH RUPEES : PROVIDED THAT THE SCHEMES OF THE SAID COMPANIES OR AUTHORITIES, OR SOCIETIES OR UNIVERSITIES OR THE INSTITUTES REFERRED TO IN SUB-C LAUSES (VII) AND (VIII) AS THE CASE MAY BE, GOVERNING THE PAYMENT OF SUCH AMOUNT ARE FRAMED IN ACCORDANCE WITH SUCH GUIDELINES (INCLUDING, INTER ALIA, CRITERIA OF ECON OMIC VIABILITY) AS MAY BE PRESCRIBED : PROVIDED FURTHER THAT WHERE EXEMPTION HAS BEEN ALLO WED TO AN EMPLOYEE UNDER THIS CLAUSE FOR ANY ASSESSMENT YEAR, NO EXEMPTION THEREU NDER SHALL BE ALLOWED TO HIM IN RELATION TO ANY OTHER ASSESSMENT YEAR; PROVIDED ALSO THAT WHERE ANY RELIEF HAS BEEN ALLOWE D TO AN ASSESSEE UNDER SECTION 89 FOR ANY ASSESSMENT YEAR IN RESPECT OF ANY AMOUNT RE CEIVED OR RECEIVABLE ON HIS VOLUNTARY RETIREMENT OR TERMINATION OF SERVICE OR V OLUNTARY SEPARATION, NO EXEMPTION UNDER THIS CLAUSE SHALL BE ALLOWED TO HIM IN RELATI ON TO SUCH, OR ANY OTHER, ASSESSMENT YEAR. UNDER THE FIRST PROVISO TO SEC.10(10C) OF THE ACT, THE SCHEME HAS TO SATISFY THE GUIDELINES AS MAY BE PRESCRIBED. RULES HAVE BEEN F RAMED AND WE ARE CONCERNED WITH R. 2BA. THE RELEVANT PORTION OF THE RULE READS AS U NDER : '.....AT THE TIME OF HIS VOLUNTARY RETIREMENT OR VO LUNTARY SEPARATION SHALL BE EXEMPT UNDER CL. (10C) OF S. 10 ONLY IF THE SCHEME OF VOLU NTARY RETIREMENT FRAMED BY THE ITA NO.2198/KOL/2014 SRI ANUPAM BISWAS. A.YR.2004-05 3 AFORESAID COMPANY OR AUTHORITY OR CO-OPERATIVE SOCI ETY OR UNIVERSITY OR INSTITUTE, AS THE CASE MAY BE : (I) IT APPLIES TO AN EMPLOYEE WHO HAS COMPLETED 10 YEARS OF SERVICE OR COMPLETED 40 YEARS OF AGE; (II) IT APPLIES TO ALL EMPLOYEES (BY WHATEVER NAME CALLED) INCLUDING WORKERS AND EXECUTIVES OF A COMPANY OR OF AN AUTHORITY OR OF A CO-OPERATIVE SOCIETY, AS THE CASE MAY BE, EXCEPTING DIRECTORS OF A COMPANY OR OF A CO -OPERATIVE SOCIETY; (III) THE SCHEME OF VOLUNTARY RETIREMENT OR VOLUNTA RY SEPARATION HAS BEEN DRAWN TO RESULT IN OVERALL REDUCTION IN THE EXISTING STRENGT H OF THE EMPLOYEES; (IV) THE VACANCY CAUSED BY THE VOLUNTARY RETIREMENT OR VOLUNTARY SEPARATION IS NOT TO BE FILLED UP; (V) THE RETIRING EMPLOYEE OF A COMPANY SHALL NOT BE EMPLOYED IN ANOTHER COMPANY OR CONCERN BELONGING TO THE SAME MANAGEMENT; (VI) THE AMOUNT RECEIVABLE ON ACCOUNT OF VOLUNTARY RETIREMENT OR VOLUNTARY SEPARATION OF THE EMPLOYEE DOES NOT EXCEED THE AMOUNT EQUIVALE NT TO THREE MONTHS SALARY FOR EACH COMPLETED YEAR OF SERVICE OR SALARY AT THE TIM E OF RETIREMENT MULTIPLIED BY THE BALANCE MONTHS OF SERVICE LEFT BEFORE THE DATE OF H IS RETIREMENT ON SUPERANNUATION.' THE ASSESSEE CLAIMED EXEMPTION OF RS.5,00,000/- U/S 10(10C) OF THE ACT. THE RETURN FILED BY THE ASSESSEE WAS PROCESSED U/S.143(1) OF T HE ACT ON 29.3.2005. SUBSEQUENTLY NOTICE U/S.148 OF THE ACT WAS ISSUED ON 25.4.2005 O N THE GROUND THAT THE DEDUCTION U/S.10(10C) OF THE ACT WAS NOT ADMISSIBLE. IT HAS BEEN THE STAND OF THE REVENUE IN THE CASE OF EMPLOYEES OF RBI THAT BENEFIT OF DEDUCTION U/S.10(10C) OF THE ACT CANNOT BE ALLOWED AS THE CONDITIONS PRESCRIBED IN THE RULES W ERE NOT SATISFIED. THE ASSESSEE FILED A RETURN IN RESPONSE TO THE NOTICE U/S.148 OF THE ACT WITHDRAWING THE CLAIM FOR DEDUCTION U/S.10(10C) OF THE ACT MADE IN THE ORIGIN AL RETURN OF INCOME. THE SAID RETURN WAS ACCEPTED BY THE AO AND AN ORDER U/S.148 READ WITH SEC.143(3) OF THE ACT WAS PASSED ON 8.8.2006. SUBSEQUENTLY THE ASSESSEE NOTICED THAT HIS COLLEAGUES WHO RECEIVED SIMILAR SUMS UNDER OERS SUCCEEDED IN JUDIC IAL PROCEEDINGS IN GETTING DEDUCTION U/S.10(10C) OF THE ACT. THE ASSESSEE THE REFORE SOUGHT LEGAL RECOURSE TO GET DEDUCTION U/S.10(10C) OF THE ACT BY FILING APPEAL A GAINST THE ORDER OF THE AO DATED 8.8.2006. THE COUNSEL HOWEVER, WITHOUT FILING AN A PPEAL, FILED AN APPLICATION FOR RECTIFICATION U/S.154 OF THE ACT BEFORE THE AO ON 1 2.2.2008. THE AO DISMISSED THE APPLICATION OF THE ASSESSEE U/S.154 OF THE ACT BY A N ORDER DATED 14.8.2008HOLDING THAT ITA NO.2198/KOL/2014 SRI ANUPAM BISWAS. A.YR.2004-05 4 THERE WAS NO APPARENT MISTAKE IN HIS ORDER CALLING FOR RECTIFICATION. ON APPEAL BY THE ASSESSEE, THE CIT(A) BY AN ORDER DATED 16.12.2009 C ONFIRMED THE ORDER OF THE AO. AN APPEAL AGAINST THE AFORESAID ORDER OF CIT(A) OUG HT TO HAVE BEEN FILED WITHIN 60 DAYS FROM THE DATE OF RECEIPT OF THE SAID ORDER. T HE APPEAL BEFORE TRIBUNAL WAS HOWEVER FILED AFTER A DELAY OF 1737 DAYS. THE REAS ONS FOR THE DELAY IN FILING APPEAL BY THE ASSESSEE ARE DEALT WITH IN THE SUBSEQUENT PARAG RAPHS. 3. THE ASSESSEE HAS FILED AN AFFIDAVIT EXPLAINING T HE REASONS FOR THE DELAY IN FILING THE APPEAL. I HAVE PERUSED THE SAID AFFIDAVIT IN WH ICH THE DELAY HAS BEEN EXPLAINED AS FOLLOWS: THE ASSESSEE HAD ENTRUSTED HIS TAX CASE TO ONE MR. MR.NARESH SARKAR AND LATER TO SHRI SHYAMAL SEN FOR FILING OF APPEAL BEFORE ITA T AGAINST THE ORDER OF CIT(A). BECAUSE OF CALLOUSNESS AND LACK OF COMMITMENT OF TH E AFORESAID TWO PERSONS THE APPEAL COULD NOT BE FILED BY THE ASSESSEE. THE ASSE SSEE ALSO SUFFERED HEALTH PROBLEMS BOTH NEUROLOGICAL AND CARDIOLOGICAL AND FOUND IT DI FFICULT TO MOVE OUTSIDE HIS RESIDENTIAL FLAT. THE ASSESSEE HAS ONLY ONE MARRIED DAUGHTER, WHO WAS ALSO SUFFERING FROM DEPRESSION DUE TO MARITAL PROBLEMS AND FULLY D EPENDENT ON THE ASSESSE FOR HER SURVIVAL. IN VIEW OF THE AFORESAID CIRCUMSTANCES TH E ASSESSEE COULD NOT FILE THE APPEAL BY FOLLOWING UP WITH THE AUTHORISED REPRESENTATIVE. THE ASSESSEE AFTER REALIZING THAT SIMILAR CLAIMS MADE BY HIS COLLEAGUES WAS ACCEPTED BY THE TRIBUNAL AND THOSE COLLEAGUES RECEIVED REFUND FORM THE DEPARTMENT PUR SUED THE MATTER VIGOROUSLY AND HAD FILED THE APPEAL IN THE END OF NOVEMBER, 2014 A FTER GETTING A PROPER REFERENCE OF THE PRESENT AR FROM HIS COLLEAGUES. 4. I HAVE CONSIDERED THE REASONS GIVEN IN THE APPLI CATION FOR CONDONATION OF DELAY AND ARE FULLY SATISFIED THAT THE DELAY IN FILING TH E APPEAL AND THE SEVERAL JUDICIAL PRONOUNCEMENT ON THE APPROACH TO BE ADOPTED IN DEAL ING WITH DELAY IN FILING APPEALS REFERRED TO BY THE LEARNED AR IN HIS SUBMISSIONS BE FORE THE TRIBUNAL. 5. THE HONBLE SUPREME COURT, IN THE CASE OF MST. KATIJI (SUPRA), HAS EXPLAINED THE PRINCIPLES THAT NEED TO BE KEPT IN MIND WHILE CONSI DERING AN APPLICATION FOR ITA NO.2198/KOL/2014 SRI ANUPAM BISWAS. A.YR.2004-05 5 CONDONATION OF DELAY. THE HONBLE APEX COURT HAS EMPHASIZED THAT SUBSTANTIAL JUSTICE SHOULD PREVAIL OVER TECHNICAL CONSIDERATION S. THE COURT HAS ALSO EXPLAINED THAT A LITIGANT DOES NOT STAND TO BENEFIT BY LODGING THE APPEAL LATE. THE COURT HAS ALSO EXPLAINED THAT EVERY DAYS DELAY MUST BE EXPLAINED DOES NOT MEAN THAT A PEDANTIC APPROACH SHOULD BE TAKEN. THE DOCTRINE MUST BE APP LIED IN A RATIONAL COMMON SENSE AND PRAGMATIC MANNER. IN THE CASE OF VEDABAI ALIAS VAIJAYANTABAI BABURAO PATIL VS. SHANTARAM BABURAO PATIL & OTHERS 253 ITR 798(SC), T HE HONBLE SUPREME COURT IN THE MATTER OF CODONATION OF DELAY SUBSTANTIAL JUSTI CE IS OF PRIME IMPORTANCE. SIMILAR WERE THE RULING OF THE HONBLE SUPREME COURT IN THE CASE OF N.BALAKRISHANAN VS. M.KRISHNAMURTHY 1998 (7) SCC 123 (SC) AND SHANKARAR O VS. CHANDRASENKUNWAR (1987) SUPPL.SCC 338 (SC). 6. I FIND THAT THE ISSUE WHETHER DEDUCTION U/S.10( 10C) OF THE ACT SHOULD BE ALLOWED TO RBI EMPLOYEES RETIRING UNDER OERS IS NO LONGER RES INTEGRA AND HAS BEEN CONCLUDED IN SEVERAL DECISIONS INCLUDING THE DECISION IN THE CASE OF CIT VS. KOODATHIL KALIYATAN AMBUJAKSHN (2008) 219 CTR (BOM) 80. IN FACT THE CB DT IN INSTRUCTION DATED 8.5.2009 HAS ACCEPTED THIS DECISION AND OPINED THAT EMPLOYEES OF RBI WHO ACCEPTED ;OERS WOULD BE ENTITLED TO THE BENEFIT OF SEC.10(10 C) OF THE ACT. 7. NOW THE SITUATION IN THE PRESENT CASE IS THAT T HE ASSESSEE WOULD BE ENTITLED TO THE BENEFIT OF DEDUCTION U/S.10(10C) OF THE ACT BUT THE DELAY IN FILLING THE APPEAL WOULD BE THE ONLY HURDLE IN NOT GETTING SUCH BENEFIT. TAX L IABILITY HAS TO BE IN ACCORDANCE WITH LAW AND NO TAX SHALL BE LEVIED OR COLLECTED SAVE UN DER THE AUTHORITY OF LAW. THERE CANNOT BE A LIABILITY TO TAX BY DEFAULT. KEEPING I N VIEW THE PRINCIPLES EMANATING FROM THE DECISIONS REFERRED TO ABOVE AND KEEPING IN VIEW THE FACT THAT THE ASSESSEE WOULD BE OTHERWISE ENTITLED TO THE BENEFIT OF DEDUCTION U /S.10(10C) OF THE ACT AND KEEPING IN MIND THE CIRCUMSTANCES IN WHICH THE APPEAL OF THE A SSESSEE WAS FILED BELATEDLY, WE ARE OF THE VIEW THAT THE DELAY IN FILING THE APPEAL SHOULD BE CONDONED. WHEN THE VERY LIABILITY OF THE ASSESSEE WAS NON-EXISTENT THE DELA Y IN FILING APPEAL SHOULD BE CONDONED. I AM OF THE VIEW THAT THE DELAY IN FILIN G THE APPEAL WAS DUE TO A REASONABLE CAUSE. I ACCORDINGLY CONDONE THE DELAY IN FILING TH E APPEAL. ITA NO.2198/KOL/2014 SRI ANUPAM BISWAS. A.YR.2004-05 6 8. AS FAR AS THE MERITS OF THE CLAIM OF THE ASSESS EE FOR DEDUCTION U/S 10(10C) OF THE ACT, AS ALREADY OBSERVED BY ME, THE ISSUE WHETHER DEDUCTION U/S.10(10C) OF THE ACT SHOULD BE ALLOWED TO RBI EMPLOYEES RETIRING UNDER O ERS IS NO LONGER RES INTEGRA AND HAS BEEN CONCLUDED IN SEVERAL DECISIONS INCLUDING T HE DECISION IN THE CASE OF CIT VS. KOODATHIL KALIYATAN AMBUJAKSHN (2008) 219 CTR (BOM) 80. IN FACT THE CBDT IN INSTRUCTION DATED 8.5.2009 HAS ACCEPTED THIS DECISI ON AND OPINED THAT EMPLOYEES OF RBI WHO ACCEPTED OERS WOULD BE ENTITLED TO THE BENE FIT OF SEC.10(10C) OF THE ACT. IN VIEW OF THE ABOVE, WE HOLD THAT THE CLAIM FOR DE DUCTION U/S.10(10C) OF THE ACT HAS TO BE ALLOWED TO THE ASSESSEE. THE FACT THAT THE A SSESSEE VOLUNTARILY OFFERED THE SUM IN QUESTION TO TAX CANNOT BE THE BASIS TO SUSTAIN T HE LEVY OF TAX. I THEREFORE HOLD THAT THERE WAS A MISTAKE APPARENT ON THE FACE OF THE REC ORD AND THE APPLICATION U/S.154 OF THE ACT FILED BY THE ASSESSEE OUGHT TO BE ALLOWED. I DIRECT THE AO TO ALLOW DEDUCTION ACCORDINGLY. 9. IN THE RESULT, THE APPEAL BY THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE COURT ON 09.12.2015. SD/- [N.V.VASUDEVAN] JUDICIAL MEMBER DATE: 09.12.2015. R.G.(.P.S.) COPY OF THE ORDER FORWARDED TO: 1. ANUPAM BISWAS, FLAT NO.1H, TRIMURTI APARTMENT, 1 39, DAKSHINDARI ROAD, KOLKATA-700048. 2 THE I.T.O., WARD-27(2), KOLKATA. 3. THE CIT-IX, KOLKATA. 4 . THE CIT(A)-XIV, KOLKATA. 5. DR, KOLKATA BENCHES, KOLKATA TRUE COPY, BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES ITA NO.2198/KOL/2014 SRI ANUPAM BISWAS. A.YR.2004-05 7