The ITO, Ward-3, Navsari V. Shri Nathubhai Parbhubhai Patel, Bilimora

ITA 2793/AHD/2010

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2114 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 7 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-05-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 20-05-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 04-10-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T SANKAR
• Assessee Lawyers: ARVIND J MISTRY
• Keywords: Competent authority; Benefit of exemption; Revised return
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH AHMEDABAD ( BEFORE SHRI D. K. TYAGI, JM AND SHRI T. R. MEENA, A M) IT A NO. 2792 AND 2793/AHD/2010 A. Y.: 2007-08 THE INCOME TAX OFFICER, WARD-3, RANGPUJA, SWAPNALOK SOCIETY, NR. KALIAWADI BRIDGE, JUNATHANA, NAVSARI THE INCOME TAX OFFICER, WARD-3, RANGPUJA, SWAPNALOK SOCIETY, NR. KALIAWADI BRIDGE, JUNATHANA, NAVSARI VS VS SHRI RAMESHBHAI CHHOTUBHAI PATEL, GANESH NAGAR SOCIETY, SARIBUJRANG, AMALSAD, P. A. NO. AANNP 3370 M SHRI NATHUBHAI PARBHUBHAI PATEL, 20, JYOTINAGAR SOCIETY, NEAR SOMNATH TEMPLE, BILIMORA, P. A. NO. AAAPP 3332 M (APPELLANT) (RESPONDENT) APPELLANT BY SHRI T. SANKAR, SR. DR RESPONDENTS BY SHRI ARVIND J. MISTRY, AR DATE OF HEARING: 20-05-2013 DATE OF PRONOUNCEMENT: 24-05-2013 O R D E R PER D. K. TYAGI: THESE TWO REVENUES APPEALS ARE FILED AGAINST THE DIFFERENT ORDERS OF THE LEARNED CIT(A), VALSAD BOTH DATED 16-07-2010 IN (I) APPEAL NO. CIT(A)/VLS/192/09-10 A ND (II) CIT(A)/VLS/191/09-10, FOR THE ASSESSMENT YEAR 2007- 08 PASSED U/S 250 READ WITH SECTION 143(3) OF THE INCOME TAX ACT, 1961. 2. THE FACTS OF THE CASE BEING SIMILAR AND AS THE I SSUE INVOLVED THEREIN IS IDENTICAL EXCEPT THE FIGURES, BOTH THE C ASES WERE HEARD TOGETHER AND THE SAME ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE BY TAKING THE FAC TS OF THE CASE IN THE CASE OF SHRI RAMESH CHHOTUBHAI PATEL IN ITA NO. 2792/AHD/2010. ITA NO.2792 & 2793/AHD/2010 (AY 2007-08) ITO V RAMESH CHHOTUBHAI PATEL ITO VS NATHUBHAI PARBHUBHAI PATEL 2 3. IN BOTH THE APPEALS THE REVENUE HAS TAKEN AS MAN Y AS SIX COMMON GROUNDS WHEREIN GROUNDS NO.4 TO 6 ARE GENERA L IN NATURE AND REQUIRE NO SPECIFIC ADJUDICATION. THE OTHER GRO UNDS NO.1 TO 3 OF THE REVENUES APPEAL ARE REPRODUCED BELOW: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE HONBLE CIT(A) ERRED IN DELETING THE ADDITION O F RS.5,00,000/- MADE ON ACCOUNT OF DISALLOWANCE OF CL AIM OF EXEMPTION U/S. 10(10C) OF THE I. T. ACT. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE HONBLE CIT(A) ERRED IN HOLDING THAT THE ASSESS EE IS ENTITLED TO DEDUCTION UNDER SECTION 10(10C), WHEN T HE SCHEME UNDER WHICH THE AMOUNT HAS PAID DOES NOT FULFILL TH E CRITERIA PRESCRIBED UNDER RULE 2BA OF THE INCOME-TAX RULES. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE HONBLE CIT(A) ERRED IN HOLDING THAT THE ASSESS EE IS ENTITLED TO DEDUCTION UNDER SECTION 10(10C), IN VIE W OF THE BOARDS CIRCULAR NO.640 DATED 26-11-1992 AND THE HO NBLE MADRAS HIGH COURTS JUDGMENT DELIVERED IN THE CASE OF COMMISSIONER OF INCOME-TAX VS. M. CHELLADURAI [2009 ] 176 TAXMAN 31 (MAD). 4. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE WA S AN EMPLOYEE OF THE STATE BANK OF INDIA. DURING THE YEAR UNDER C ONSIDERATION, THE ASSESSEE WAS VOLUNTARILY RETIRED FROM THE SERVICES WITH EFFECT FROM 30-04-2006 UNDER EARLY EXIT OPTION SCHEME AND RECEI VED VARIOUS RETIREMENT BENEFITS WHICH INCLUDED AN AMOUNT OF RS. 5,82,787/- AS EX- GRATIA PAYMENT. THE AO NOTICED FROM FORM NO.16 THAT THE BANK HAD DEDUCTED TAX AT SOURCE WHILE MAKING EX-GRATIA PAYME NT. THE EX-GRTIA PAYMENT RECEIVED BY THE ASSESSEE WAS FULLY OFFERED TO TAX IN THE ORIGINAL RETURN OF INCOME BY THE ASSESSEE. HOWEVER, THE ASSESSEE HAD CLAIMED EXEMPTION OF RS.5,00,000/- U/S 10(10C) OF THE ACT ON ITA NO.2792 & 2793/AHD/2010 (AY 2007-08) ITO V RAMESH CHHOTUBHAI PATEL ITO VS NATHUBHAI PARBHUBHAI PATEL 3 THIS EX-GRATIA PAYMENT IN THE REVISED RETURN OF INC OME. THE AO AFTER GOING THROUGH THE CIRCULAR ISSUED BY THE COMPETENT AUTHORITY OF STATE BANK OF INDIA CONTAINING THE DETAILED PROVISIONS FO R EARLY EXIT OPTION SCHEME AND OPERATIVE GUIDELINES, CBDT CIRCULAR NO.6 40 DATED 24- 11-1992 AND VARIOUS JUDICIAL PRONOUNCEMENTS HELD TH AT EXIT OPTION SCHEME OF STATE BANK OF INDIA DOES NOT FULFILL THE MANDATORY CONDITIONS LAID DOWN IN RULE 2BA OF THE INCOME TAX RULES, 1962. ACCORDINGLY, ASSESSEES CLAIM OF EXEMPTION U/S 10(1 0C) OF THE ACT OF RS.5,00,000/- WAS DISALLOWED AND ADDED TO THE INCOM E OF THE ASSESSEE. 5. THE ASSESSEE CARRIED THE MATTER BEFORE THE FIRST APPELLATE AUTHORITY AND THE LEARNED CIT(A) DELETED THE ADDITI ON OF RS.5,00,000/- MADE BY THE AO ON ACCOUNT OF DISALLOWANCE OF CLAIM OF EXEMPTION U/S 10(10C) OF THE ACT RELYING ON THE DECISION DELIVERE D IN THE CASE OF CIT VS KRISHNA GOPAL SAHA 125 TTJ 577 (KOL) (T M) AND C IT VS NAGESH DEVIDAS KULKARNI & ORS. [2007] 210 CTR (BOM) 471, [ 2007] 291 ITR 407 (MUM.) HOLDING THAT THE ASSESSEE WAS ELIGIBLE F OR THE BENEFIT OF EXEMPTION OF RS.5,00,000/- U/S 10(10C) OF THE ACT E VEN THOUGH THE EARLY EXIT OPTION SCHEME IS NOT IN CONFORMITY WITH THE REQUIREMENT OF RULE 2BA OF THE INCOME TAX RULES,1962. 6. WE HAVE HEARD BOTH THE SIDES AND CAREFULLY PERUS ED THE ORDERS OF THE AUTHORITIES BELOW ALONG WITH THE MATERIALS P RODUCED BEFORE US. WE FIND NO INFIRMITY IN THE ORDER OF THE LEARNED CI T(A) AS ON IDENTICAL FACTS IN THE CASE OF SMT. JAYA NARAYANAN AND OTHER S VS ACIT, CIR-5, AHMEDABAD, ITAT AHMEDABAD A BENCH IN ITA NO.1209/ AHD/2007 ITA NO.2792 & 2793/AHD/2010 (AY 2007-08) ITO V RAMESH CHHOTUBHAI PATEL ITO VS NATHUBHAI PARBHUBHAI PATEL 4 HAD PASSED THE ORDER DATED 17-07-2007 IN FAVOUR OF THE ASSESSEE ALLOWING THE CLAIM OF EXEMPTION U/S 10(10C) OF THE ACT. THEREFORE, THE ORDER PASSED BY THE LEARNED CIT(A) IS HEREBY UPHELD . ACCORDINGLY, THE APPEAL OF THE REVENUE IN ITA NO.2792/AHD/2010 F OR THE ASSESSMENT YEAR 2007-08 IN THE CASE OF SHRI RAMESH CHHOTUBHAI PATEL IS DISMISSED. 7. THERE BEING NO DIFFERENCE IN THE FACTS OF THE CA SE AND THE ISSUE INVOLVED IN THE APPEAL OF THE REVENUE IN ITA NO.279 2/AHD/2010 WITH THAT OF THE APPEAL OF THE REVENUE IN ITA NO.2793/AH D/2010 FOR THE ASSESSMENT YEAR 2007-08 IN THE CASE OF THE OTHER AS SESSEE VIZ. SHRI NATHUBHAI PARBHUBHAI PATEL, WE FOLLOWING OUR ABOVE DECISION IN THE REVENUES APPEAL IN ITA NO.2792/AHD/2010, HEREBY DI SMISS THE REVENUES APPEAL IN ITA NO.2793/AHD/2010 FOR THE AS SESSMENT YEAR 2007-08 ALSO. 8. IN THE RESULT, BOTH THE APPEALS OF THE REVENUE A RE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 24-05-2013 SD/- SD/- (T. R. MEENA) ACCOUNTANT MEMBER (D. K. TYAGI) JUDICIAL MEMBER LAKSHMIKANT LAKSHMIKANT LAKSHMIKANT LAKSHMIKANTA AA A DE DE DE DEKA/ KA/ KA/ KA/ ITA NO.2792 & 2793/AHD/2010 (AY 2007-08) ITO V RAMESH CHHOTUBHAI PATEL ITO VS NATHUBHAI PARBHUBHAI PATEL 5 COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE BY ORDER ASST. REGISTRAR, ITAT, AHMEDABAD 1. DATE OF DICTATION: DIRECT ON COMPUTER 20-05-20 13 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: 21-05-2013 OTHER MEMBER: 3. DATE ON WHICH APPROVED DRAFT COMES TO THE SR.P.S ./P.S.: 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE S R. P.S./P.S.: 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK: 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK: 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER: 9. DATE OF DESPATCH OF THE ORDER: