LORRAINE MARIA FONCECA, MUMBAI V. ITO 26(2))(2), MUMBAI

ITA 3500/MUM/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 101098 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 4 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-09-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 30-07-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 02-05-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: A K KARDA M
• Assessee Lawyers: BEHARILAL
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A, MUMBAI BEORE SHRI G.S.PANNU, ACCOUNTANT MEMBER AND SHRI RAMLAL NEGI, JUDICIAL MEMBER ITA NO. 3500/MUM/2011 (ASSESSMENT YEAR : 2007-08) MRS. LORRAINE MARIA FONCECA, FLAT NO.10, BERCHMAN HOUSE, ST.PETERS, 31, PALI ROAD, BANDRA (W), MUMBAI 400050 PAN: AAAPF 3419L ... APPELLANT VS. THE INCOME TAX OFFICER 26(2)(2) MITTAL BLDG., CHARNI ROAD, MUMBAI 400 002 .... RESPONDENT APPELLANT BY : SHRI BEHARILAL REVENUE BY : SHRI A.K.KARDAM DATE OF HEARING : 22/09/2015 DATE OF PRONOUNCEMENT : 22/09/2015 ORDER PER G.S. PANNU,AM: THE CAPTIONED APPEAL BY THE ASSESSEE IS DIRE CTED AGAINST THE ORDER OF THE CIT(A)-28, MUMBAI DATED 03/03/2011 PERTAINING TO THE ASSESSMENT YEAR 2007-08, WHICH IN-TURN HAS ARISEN FROM AN ORDER PASSED BY THE ASSESSING OFFICER DATED 26/10/2010 UNDER SECTION 143(3) R.W.S. 147 OF THE INCOME TAX ACT, 1961 ( I N SHORT THE ACT). 2. GROUND OF APPEAL RAISED BY THE ASSESSEE READS AS UNDER: 2 ITA 3500/MUM/2011 (ASSESSMENT YEAR : 2007-08) 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL) 28 HAS ERRED IN ADDING RS.30,78,644/- ON ACCOUNT OF RETIREMENT BENEFIT UND ER THE FACTS AND CIRCUMSTANCES OF THE CASE, HE OUGHT NOT TO HAVE ADD ED THE SAME. 3. IN BRIEF, THE RELEVANT FACTS ARE THAT ASSESSEE I S AN INDIVIDUAL, WHO FILED HER RETURN OF INCOME DECLARING A TOTAL INCOME OF RS.9,91,050/-, WHICH HAS BEEN SUBJECT TO AN ASSESSMENT UNDER SECTI ON 143(3) R.W.S. 147 OF THE ACT. THE ASSESSING OFFICER NOTICED THAT ASSESSEE HAD RECEIVED RETIREMENT BENEFITS OF RS.30,78,644/- DETA ILED AS UNDER:- 1. VOLUNTARY SEPARATION PAYMENT : RS.26,03,457 2. BONUS : RS. 4,09,887 3. TAX ADVISOR ALLOWANCE : RS. 65,300 4. BEFORE THE ASSESSING OFFICER, THE ASSESSEE CLAIM ED THAT THE ABOVE RETIREMENT BENEFITS ARE EXEMPT IN TERMS OF SECTION 10(10C) OF THE ACT. THE ASSESSING OFFICER HAS REFERRED TO SECTION 10(10 C) OF THE ACT AND HELD THAT ASSESSEE WAS NOT ENTITLED TO THE RELIEF C ONTAINED THEREIN BECAUSE THE VOLUNTARY RETIREMENT TAKEN BY THE ASSE SSEE IS NOT UNDER ANY APPROVED SCHEME OF VRS. THEREFORE, THE ASSESSI NG OFFICER ASSESSED THE TOTAL INCOME AT RS.40,69,700/- AS AGAINST RS.9, 91,050/- RETURNED BY THE ASSESSEE. THE CIT(A) HAS ALSO HELD THAT THE AS SESSEE WAS NOT ENTITLED TO THE CLAIM OF EXEMPTION UNDER SECTION 1 0(10C) OF THE ACT ON THE GROUND THAT THE IMPUGNED AMOUNTS WERE NOT RECEI VED BY THE ASSESSEE ON THE BASIS OF ANY APPROVED SCHEME OF V OLUNTARY RETIREMENT OR VOLUNTARY SEPARATION. 5. BEFORE US, THE LD. REPRESENTATIVE FOR THE ASSESS EE SUBMITTED THAT THE IMPUGNED AMOUNT WAS RECEIVED FROM ERSTWHILE EMP LOYER M/S. DELTA AIRLINES IN TERMS OF A VOLUNTARY SEPARATION S CHEME, COPY OF WHICH HAS BEEN PLACED AT PAPER BOOK PAGES 5 TO 12. IT WA S ASSERTED BY THE LD. REPRESENTATIVE FOR THE ASSESSEE THAT THE AFORESAID SCHEME WAS BEFORE 3 ITA 3500/MUM/2011 (ASSESSMENT YEAR : 2007-08) THE LOWER AUTHORITIES AND THE SAME COMPLIED WITH TH E REQUIREMENTS OF SECTION 10(10C) OF THE ACT AND, THEREFORE, THE EXEM PTION WAS RIGHTLY CLAIMED BY THE ASSESSEE. 6. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTAT IVE POINTED OUT THAT THERE IS NO MENTION IN THE ORDERS OF THE LOWER AUTHORITIES ABOUT THE VOLUNTARY SEPARATION SCHEME BEING REFERRE D BY THE ASSESSEE AND, THEREFORE, THE LOWER AUTHORITIES HAVE NOT ACCE PTED THE CLAIM OF THE ASSESSEE. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFUL LY. THE DISPUTE IN THE PRESENT APPEAL RELATES TO THE CLAIM OF THE A SSESSEE FOR EXEMPTION UNDER THE PROVISIONS OF SECTION 10(10C) OF THE ACT ON THE GROUND THAT SHE RECEIVED THE AMOUNT ON ACCOUNT OF VOLUNTARY RETIREMENT SCHEME FROM HER ERSTWHILE EMPLOYER M/S. DELTA AIRLINES. A S PER THE ASSESSING OFFICER AS WELL AS THE CIT(A), EXEMPTION UNDER SECT ION 10(10C) OF THE ACT IS NOT ALLOWABLE BECAUSE THE ASSESSEE LEFT THE SERVICE VOLUNTARILY AND NOT IN TERMS OF ANY APPROVED SCHEME OF THE EMPL OYER COMPANY. THE CLAIM SET UP BY THE ASSESSSEE IS THAT THE SAID FINDING OF THE LOWER AUTHORITIES IS WITHOUT TAKING INTO CONSIDERATION TH E VOLUNTARY SEPARATION SCHEME FOR IN-FLIGHT SERVICES EMPLOYEES OF DELTA AI RLINES, A COPY OF WHICH HAS ALSO BEEN PLACED IN THE PAPER BOOK FILED BEFORE US. 7.1 SECTION 10(10C) OF THE ACT PROVIDES FOR EXEMPTI ON OF ANY AMOUNT RECEIVED BY AN EMPLOYEE ON VOLUNTARY RETIREMENT OR TERMINATION OF HIS SERVICE IN ACCORDANCE WITH ANY SCHEME OR SCHEMES OF VOLUNTARY RETIREMENT OR OTHER SCHEMES PRESCRIBED THEREIN. IT IS ALSO PROVIDED IN SECTION 10(10C) OF THE ACT THAT THE SCHEME OF VOLUN TARY RETIREMENT SHOULD MEET WITH THE REQUIREMENTS CONTAINED IN R ULE- 2BA OF THE 4 ITA 3500/MUM/2011 (ASSESSMENT YEAR : 2007-08) INCOME TAX RULES, 1962. THUS, IT WOULD BE NECESSAR Y TO EXAMINE THE CLAIM OF THE ASSESSEE HAVING REGARD TO THE PROVISIO NS OF SECTION 10(10C) OF THE ACT R.W.R 2BA OF THE RULES. IN THE ABSENCE OF ANY FINDING ON THIS ASPECT BY THE LOWER AUTHORITIES, WE DEEM IT FIT AND PROPER TO RESTORE THE MATTER BACK TO THE FILE OF ASSESSING OFFICER, WHO S HALL PASS AN ORDER AFRESH ON THIS ASPECT AS PER LAW. 7.2 NEEDLESS TO MENTION, THE ASSESSEE SHALL FURNIS H THE REQUISITE MATERIAL IN SUPPORT OF HER CLAIM OF EXEMPTION UNDER SECTION 10(10C) OF THE ACT AND THE ASSESSING OFFICER SHALL CONSIDER TH E SUBMISSIONS AND MATERIAL PUT-FORTH BY THE ASSESSEE AND ADJUDICATE A FRESH AS PER LAW. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED, AS ABOVE. THE ABOVE DECISION WAS PRONOUNCED IN THE OPEN COU RT IN THE PRESENCE OF BOTH THE PARTIES AT THE CONCLUSION OF H EARING ON 22/09/2015. SD/- SD/- (RAMLAL NEGI) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT ME MBER MUMBAI, DATED 22/09/2015 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI VM , SR. PS