TARACHAND ANNSAHEB GAIKWAD, AURANGABAD V. ACIT CENTRAL CIRCLE 1, AURANAGABAD

ITA 861/PUN/2022

AI Insights

The case involves Tarachand Annsaheb Gaikwad, who appealed against the decision of the CIT(A) which upheld the assessment order treating the amount received under an Early Retirement Scheme (ERS) as a revenue receipt, thus chargeable to tax. The assessee argued that the amount should be considered a capital receipt, referencing similar cases where the National Faceless Appeal Centre (NFAC) accepted this view. The Tribunal noted the precedents and remitted the matter back to the CIT(A) for a decision aligned with these cases, allowing the assessee a reasonable opportunity of hearing.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 137684 (ITAT-PUNE)
• Duration Of Justice: 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 28-02-2023
• Assessment Year: 2016-2017
• Appeal Filed On: 30-11-2022
• Other Referred Cases: Balasaheb Shivram Kokane Vs. ACIT, Kisan Goroba Kharade, Deepak Shankarbhai Patel, Kailas Dadaji Pagare
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Capital receipt

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “SMC”, PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT आयकर अपील सं. /ITA No. 861/PUN/2022 नधा रण वष / Assessment Year : 2016-17 Tarachand Annsaheb Gaikwad, Plot No.145/A, CIDCO Growth Centre, Waluj, Mahangar 1, MIDC, Aurangabad 431 136, Maharashtra PAN : AGZPG1341B Vs. ACIT, Circle-1, Aurangabad Appellant Respondent आदेश / ORDER PER R.S. SYAL, VP : This appeal by the assessee arises out of the order dated 17-10-2022 passed by CIT(A) in National Faceless Appeal Centre (NFAC), Delhi u/s.250 of the Act in relation to the assessment year 2016-17. 2. The assessee is aggrieved by not treating the amount received from his employer under early retirement scheme as a ‘Capital receipt’ and hence, not chargeable to tax. 3. Succinctly, the facts of the case are that the assessee was working with Colgate Palmolive (India) Limited. He Assessee by Ms. Arrchena Shetty Revenue by Shri Akhilesh Srivastava Date of hearing 01-03-2023 Date of pronouncement 01-03-2023 ITA No. 861/PUN/2022 Tarachand Annsaheb Gaikwad 2 filed the return declaring total income of Rs.29,63,060/-, in which relief u/s.89(1) was claimed on account of Voluntary Retirement scheme availed by him. The assessee claimed in the return that the amount received was towards Early Retirement Scheme (ERS) and hence, covered under Rule 21A(1)(a). The assessee urged during the course of assessment proceedings that the amount was not at all chargeable to tax as it was in the nature of ‘Capital receipt’. Relevant discussion in this regard has been made on page 9 of the assessment order recording the assessee’s claim of ‘capital receipt’. The AO held that the amount was not a ‘capital receipt’ but a “revenue receipt’ chargeable to tax under section 17 read with rule 21(A)(1)(c). He thus restricted the claim u/s. 89(1) to Rs.2,78,125/- as against Rs.7,87,760/- made by the assessee. The ld. CIT(A) remained unconvinced and upheld the assessment order on this score. 4. I have heard the rival submissions and gone through the relevant material on record. It is seen that the ld. CIT(A) dismissed the assessee’s claim of the amount having been received as a ‘capital receipt’. The ld. AR has brought to ITA No. 861/PUN/2022 Tarachand Annsaheb Gaikwad 3 my notice three orders passed by the National Faceless Appeal Centre accepting the amount received as ‘capital receipt’ in the hands of other employees who received the amount on Termination of service under Early Retirement Scheme in similar circumstances. One order passed by the NFAC, Delhi is in the case of Kisan Goroba Kharade dt. 05-09-2022, another one is dated 02-09-2022 in the case of Deepak Shankarbhai Patel and still another dated 01-08-2022 in the case of Kailas Dadaji Pagare. In all these three appeals, the ld. CIT(A) has accepted the claim of ‘capital receipt’ towards the amount received by these hitherto employees of Colgate Palmolive (India) Limited who availed the Early Retirement Scheme benefit similar to the assessee. Further, a Tribunal order in Balasaheb Shivram Kokane Vs. ACIT (ITA No.690/PUN/2022) dt.07-11-2022 was also brought to my notice, in which, the matter was remitted to the file of Ld. CIT(A) for disposal on merits. In the hue of above submissions, the ld. AR requested that the matter may be restored to the file of ld. CIT(A) for passing a speaking order in the case of the assessee. No serious objection was taken by the ld. DR. In ITA No. 861/PUN/2022 Tarachand Annsaheb Gaikwad 4 view of the rival but common submissions, I set-aside the impugned order and remit the matter to the file of the ld. CIT(A) for disposing the appeal on merits after taking into consideration the aforenoted order of the Tribunal in Balasaheb Shivram Kokane and also view canvassed in the above three appeals and further, if any appeals by the Revenue, against such orders have been presented before the Tribunal and the consequential fate of such appeals. Needless to say, the assessee will be allowed a reasonable opportunity of hearing. 5. In the result, the appeal is allowed for statistical purposes. Order pronounced in the Open Court on 01 st March, 2023. Sd/- (R.S.SYAL) उपा य / VICE PRESIDENT प ु णे Pune; दनांक Dated : 01 st March, 2023 Satish ITA No. 861/PUN/2022 Tarachand Annsaheb Gaikwad 5 आदेश की ितिलिप अ ेिषत/Copy of the Order is forwarded to: 1. अपीलाथ / The Appellant; 2. 3. थ / The Respondent The Pr.CIT concerned 4. 5. DR, ITAT, ‘SMC’ Bench, Pune गाड फाईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune Date 1. Draft dictated on 01-03-2023 Sr.PS 2. Draft placed before author 01-03-2023 Sr.PS 3. Draft proposed & placed before the second member - JM 4. Draft discussed/approved by Second Member. - JM 5. Approved Draft comes to the Sr.PS/PS Sr.PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order. *