ITO, Ward 2(1), Kolhapur V. Smt. Vidya Shriram Joshi, Kolhapur

ITA 322/PUN/2013

• Counselvise Citation: 32224514 RSA 2013
• Duration Of Justice: 8 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 01-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: WALIMBE

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER, AND SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NO.322/PN/2013 A.Y. 2008-09 INCOME TAX OFFICER, WARD 2(1), KOLHAPUR APPELLANT VS. SMT. VIDYA SHRIRAM JOSHI, FLAT NO.5, DASHARATH APARTMENT, 1178 E WARD, MALI COLONY, KOLHAPUR. PAN:AALPJ7561Q RESPONDENT APPELLANT BY : SHRI WALIMB E RESPONDENT BY : SHRI M.K . KULKARNI DATE OF HEARING: 21.10.2013 DATE OF ORDER : 22.10.2013 ORDER PER SHAILENDRA KUMAR YADAV, JM THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) [(IN SH ORT CIT(A)], KOLHAPUR DATED 30-11-2012 FOR A.Y. 2008-09 ON THE F OLLOWING GROUNDS. (1) THE APPELLANT PRAYS THAT MONETARY LIMITS SPECIF IED UNDER INSTRUCTIONS NO.3 OF 2011 DATED 09.02-2011 MA Y NOT BE APPLIED TO THE PRESENT CASE, AND SIMILAR OTHER C ASES, AS THESE CASES ARE COVERED BY THE DECISION OF THE HON BLE 2 SUPREME COURT IN THE CASE OF CIT VS. SURYA HARBAL LTD. [ 243 CTR 327 (SC) ] WHEREIN, THE RONNIE COURT HAS HE LD THAT ' THE CIRCULAR DATED 09-02-2011 SHOULD NOT BE APPLI ED IPSO FACTO, PARTICULARLY WHEN THE MATTER HAS A CASCADING EFFECT. THERE ARE CASES UNDER THE INCOME TAX ACT, 1961 , IN WHICH A COMMON PRINCIPLE MAY BE INVOLVED IN SUBSEQU ENT GROUP OF MATTERS OR A LARGE NUMBER OF MATTERS. (2) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE RONNIE CIT(A)FAILED TO APPRECIATE THE FACT THAT THE EMPLOYEES OPTED FOR EXIT OPTION SCHEME DECLARED BY SBI AND SBI, PATIALA AND OTHER ASSOCIATE BANKS ARE NOT ELIGIBLE FOR EXEMPTION U/S.L0(1 OC) AS RIGHTLY POINTED OUT B Y THE BOARD UNDER LETTER F.NO.200/34/2009/ITA.I DATED 06- 10- 2009. (3) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE HON'BLE CIT(A) IS NOT JUSTIFIED IN NOT APPRECIATING THAT THE LEGAL REQUIREMENTS PRESCRIBED UNDER RULE 2 BA OF TH E IT RULES, 1962 WERE NOT COMPLETELY FULFILLED UNDER THE EXIT OPTION SCHEME. (4) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE HON. CIT(A) IS NOT JUSTIFIED IN IGNORING THE FACT T HAT, THERE IS ONLY A PARTIAL SATISFACTIONS OF THE CONDITIONS STIP ULATED UNDER RULE 2BA, UNDER THE AFORESAID EXIT OPTION SCH EME, AS IS BROUGHT OUT IN FOLLOWING CHART, AND IS THEREFORE , NOT ELIGIBLE FOR DEDUCTION U/S 10(10C) OF THE ACT: TEST (CONDITIONS PRESCRIBED UNDER RULE 2BA ) FACTS PREVAILING IN THE INSTANT CASE. (I) SHOULD BE APPLICABLE TO EMPLOYEES WHO HAS COMPLETED 10 YEARS OF SERVICE OR COMPLETED 40 YRS OF AGE. THIS CONDITION IS SATISFIED (II) SHOULD APPLY TO ALL EMPLOYEES (EXCEPT DIRECTORS) IN THIS RESPECT IT IS SEEN THAT THE SCHEME IS APPLICABLE ONLY TO CLERICAL & SUBORDINATE CADRE 3 EMPLOYEES, AND IS NOT APPLICABLE TO THE OFFICER CADRE OF THE BANK. (III) SHOULD RESULT IN OVERALL REDUCTION IN STRENGTH OF BANK THE OBJECT OF THE SCHEME IS ONLY TO PROVIDE AN EXIT ROUT TO THE EMPLOYEES IN WORKMEN CATEGORY WHO FEEL FRUSTRATED AND DE- MOTIVATED. IT MAY BE MENTIONED THAT THERE IS NOTHING EXPRESSLY STATED IN THE SCHEME REGARDING OVERALL REDUCTION OF STRENGTH OF THE BANK, THOUGH THE STEPS TAKEN HAS RENDERED EMPLOYEES SURPLUS. (IV) THE VACANCY SO CAUSED SHOULD NOT BE SUBSEQUENTLY FILLED UP. THOUGH THE SBI'S LETTER DATED 31-08-2007 STATES THAT NO PERMANENT RECRUITMENT HAS BEEN MADE AGAINST SUCH RETIREMENTS, THERE IS NOTHING IN THE SCHEME WHICH INDICATES THAT THE VACANCIES SO RAISED, WILL NOT BE FILLED UP IN FUTURE. (V) THE RETIRING EMPLOYEES SHOULD NOT BE RE- EMPLOYED IN SAME COMPANY, OR COMPANY UNDER SAME MANAGEMENT. THIS CONDITION IS SATISFIED (VI) THE AMOUNT RECEIVABLE DOES NOT EXCEED 3 MONTH'S SALARY FOR EACH COMPLETED YEAR OF SERVICE, OR SALARY AT THE TIME OF RETIREMENT MULTIPLIED BY BALANCE MONTHS. TH IS CONDITION IS SATISFIED THE WORKING OF THE EX- GRATIA PAYMENT IS ON ENTIRELY DIFFERENT FOOTINGS, AND SUCH CONDITIONS HAVE NOT BEEN INCORPORATED THEREIN. 4 (5) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE HON. CIT(A) IS NOT JUSTIFIED IN IGNORING THE CONTEN TS OF LETTER OF THE BANKING AUTHORITIES (I.E ASST. GENERAL MANAG ER, LOCAL HEAD OFFICE, STATE BANK OF INDIA, BANDRA (E), MUMBA I BRANCH), VIDE PARA 3 OF LETTER DT. 30-07-2007, WHER EIN IT IS CATEGORICALLY ASSERTED THAT, '3. THE SCHEME DOES NOT COMPLY WITH THESE STIPULATI ONS. THEREFORE TDS IS REQUIRED TO BE DEDUCTED AT SOURCE ON THE EX- GRATIA AMOUNT PAYABLE TO THE EXIT-OPTEES' (6) THE APPELLANT PRAYS THAT THIS CASE BE CLUBBED W ITH OTHER SIMILAR CASES, WHEREIN SAME ISSUE IS INVOLVED , AS THERE ARE CASES UNDER THE INCOME TAX ACT, 1961, IN WHICH A CO MMON PRINCIPLE IS INVOLVED IN A LARGE NUMBER OF MATTERS. (7) THE APPELLANT ALSO PRAYS THAT THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), KOLHAPUR BE VACATED AND THAT OF THE ASSESSING OFFICER BE RESTOR ED. (8) THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND , RAISE, ANY OF THE ABOVE, OR ANY OTHER GROUNDS RAISED. 2. THE ASSESSEE IS AN EMPLOYEE OF STATE BANK OF IND IA, RETIRED VOLUNTARILY AS PER EXIT OPTION SCHEME ANNOUNCED BY BANK. IN HER RETURN OF INCOME, THE ASSESSEE CLAIMED EXEMPTIO N U/S. 10(10C) ON EX-GRATIA RECEIVED FROM BANK ON HER VOLU NTARY RETIREMENT. THE ASSESSING OFFICER DENIED CLAIM OF EXEMPTION U/S. 10(10C). IN APPEAL, THE CIT(A) FOLLOWING THE CASE OF VIJAY GANPATRAO PATIL HAS DECIDED THE APPEAL IN FAVOUR OF ASSESSEE WHICH WAS IN-TURN UPHELD BY THE TRIBUNAL. NOTHING CONTRARY WAS BROUGHT TO OUR KNOWLEDGE. FACTS BEING SIMILAR SO F OLLOWING THE SAME REASON, WE ARE NOT INCLINED TO INTERFERE WITH THE ORDER OF THE CIT(A) WHO HAS ALLOWED THE CLAIM OF EXEMPTION U/S. 10(10C) ON EX-GRATIA AMOUNT RECEIVED FROM BANK ON HER VOLUNTAR Y RETIREMENT. THIS VIEW IS FORTIFIED BY DECISION OF BOMBAY HIGH 5 COURT REPORTED IN (2008) 219 CTR BOMBAY 80 IN RBI C ASES. ACCORDINGLY, THE ORDER OF CIT(A) IS UPHELD. 3. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED. PRONOUNCED IN THE OPEN COURT ON THE DAY OF 22 ND OCTOBER 2013. SD/- SD/- (R.K. PANDA) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE, DATED: 22 ND OCTOBER 2013 GCVSR COPY TO:- 1) DEPARTMENT 2) ASSESSEE 3) THE CIT(A), KOLHAPUR 4) THE DR, B BENCH, I.T.A.T., PUNE. 5) GUARD FILE //TRUE COPY// BY ORDER SENIOR PRIVATE SECRETARY, I.T.A.T., PUNE