The ITO, Ward-15(1),, Ahmedabad v. Shri Kanaiyalal Vadilal Bhavsar, Ahmedabad

ITA 3276/AHD/2009 | 2007-2008
Pronouncement Date: 29-01-2010 | Result: Dismissed

Appeal Details

RSA Number 327620514 RSA 2009
Bench Ahmedabad
Appeal Number ITA 3276/AHD/2009
Duration Of Justice 1 month(s) 20 day(s)
Appellant The ITO, Ward-15(1),, Ahmedabad
Respondent Shri Kanaiyalal Vadilal Bhavsar, Ahmedabad
Appeal Type Income Tax Appeal
Pronouncement Date 29-01-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted SMC
Tribunal Order Date 29-01-2010
Date Of Final Hearing 20-01-2010
Next Hearing Date 20-01-2010
Assessment Year 2007-2008
Appeal Filed On 09-12-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'SMC' (BEFORE SHRI N S SAINI ACCOUNTANT MEMBER) ITA NO.3276/AHD/2009 (ASSESSMENT YEAR:- 2007-08) THE INCOME-TAX OFFICER WARD-15(1) AHMEDABAD V/S SHRI KANAIYALAL VADILAL BHAVSAR VARSHA STATE BANK STAFF SOCIETY NEAR RAILWAY CROSSING CHANDLODIA AHMEDABAD [APPELLANT] [RESPONDENT] APPELLANT BY :- SHRI GOVIND SINGHAL SR. DR RESPONDENT BY:- NONE O R D E R THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) DA TED 29-10- 2009 FOR ASSESSMENT YEAR 2007-08 WHEREBY THE LEARN ED COMMISSIONER OF INCOME-TAX (APPEALS) HAS DELETED TH E ADDITION OF RS.3 44 037/- U/S 10(10C) OF THE INCOME-TAX ACT 19 61 [THE ACT FOR SHORT]. 2 THE BRIEF FACTS OF THE CASE ARE THAT THE LEARNED ASSESSING OFFICER FOUND THAT IT IS SEEN FROM THE RETURN OF IN COME THAT THE ASSESSES HAS RECEIVED A SUM OF RS.3 44 037/- UNDER THE HEAD OF EX GRATIA PAYMENT AS A RESULT OF VOLUNTARY RETIREMENT FROM SERVICE AND THE SAID AMOUNT HAS BEEN CLAIMED EXEMPTED U/S. 10(10C)OF THE IT ACT 1961. 3 THE LEARNED ASSESSING OFFICER FURTHER OBSERVED T HAT IT IS FURTHER SEEN FROM THE DETAILS FURNISHED RELATED TO PAYMENT OF RS.3 44 037/-THAT THE ASSESSEE WAS EMPLOYEE OF SBI AHMEDABAD AND HE HAS APPLIED FOR VOLUNTARY RETIREMENT SCHEME FRAMED BY STATE BANK OF INDIA UND ER THE NAME AND STYLE OF 2 EXIT-OPTION SCHEME. ACCORDINGLY HE WAS PAID EX-GRA TIA PAYMENT OF RS.3 44 037/- UNDER THE ABOVE VRS SCHEME. WHERE THE ASSESSMENT ORDER PASSED BY ITO MR. K.J.BH ATT THAT DISALLOWED THE AMOUNT RECEIPT OF VRS ON THE GROUND OF THAT THE SCH EME FRAMED BY SBI IS NOT IN ACCORDANCE WITH RULE 2BA OF THE I.T. ACT 1962. BUT ASSESSEE'S ARGUMENTS THAT ALL THE FOLLOWING COURTS DECISIONS ARE IN FAVOUR OF DED UCTION OF ALLOWABLE BUT ITO IS NOT SATISFIED THAT THERE IS NO DIRECT JUDGMENT OF H ON'BLE HIGH COURT OF GUJARAT. 4.4 FOLLOWING CASE LAWS ARE IN SUPPORT OF MY APP ELLANT: - 1. MADRAS HIGH COURT CIT VS. G.V.VENOGOPAL (EMPLOYEE OF SBI) (273 ITR 30 7) 2. KARNATAKA HIGH COURT CIT & OTHERS VS. P.SURENDRA PRABHU (279 ITR 402) 3. KERALA HIGH COURT STATE BANK OF TRAVANKOR VS. CBDT (282 ITR 587) 4. MADRAS HIGH COURT CIT VS. S.SUNDER & OTHERS (284 ITR 687) 5. MADRAS HIGH COURT CIT VS. J.RAMAMANI (286 ITR 616) 6. BOMBAY HIGH COURT NAGPUR BRANCH CIT VS. NAGESH DEVIDAS KULKARNI. (291 ITR 407) 7. MADRAS HIGH COURT CIT VS. M. ABDULKARIM (311 ITR 162) 8. BOMBAY HIGH COURT CIT VS. KOODATHI KALIYATAN AMBUJAKSAN (219 CTR 80 ( 2008)) 9. KARNATAKA HIGH COURT WRITE PETITION NO. 5508 OF 200. SHRI K. AMBALAKAN. DEPUTY MANAGER ( AN OFFICER IN MIDDLE MANAGEMENT GRADE-2) STATE BANK OF INDIA VS. 1. STATE BANK OF INDIA 2. CENTRAL BOARD OF DIRECT TAXES 3. INCOME TAX OFFICER (TDS) BANGLORE 4 THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE HELD AS UNDER:- 5 I HAVE CAREFULLY CONSIDERED THE ABOVE REPLY AND CASE LAWS CITED THEREIN. I HAVE ALSO CONSIDERED THE ARGUMENTS PUT F ORTH BY THE AR OF THE ASSESSEE MR. DEEPAK BUDHWANI (CA). I CONSIDERED THA T THE HIGH COURT JUDGMENTS ARE PERTAINING TO BOMBAY HIGH COURT MADR AS HIGH COURT KARNATAKA HIGH COURT KERALA HIGH COURT ETC. WHICH ARE MENTIONED ABOVE ARE ALL IN FAVOUR OF DEDUCTION ALLOWABLE U/S 10(10C ) OF I.T. ACT 1961. 3 6 IN THE RESULT THE APPEAL IS ALLOWED AND AO IS DI RECTED TO GIVE DEDUCTION U/S 10(10C) OF THE I.T. ACT OF RS.3 44 03 7/-. 5 THE LEARNED DEPARTMENTAL REPRESENTATIVE SUPPORTE D THE ORDERS OF THE LOWER AUTHORITIES. 6 NONE APPEARED ON BEHALF OF THE ASSESSEE WHEN THE CASE WAS CALLED FOR HEARING AND NEITHER ANY ADJOURNMENT APPLICATION WAS FILED. THE BENCH WAS OF THE VIEW THAT THE APPEAL OF THE REVENUE CAN BE DISPOSED OF IN ABSENCE OF THE ASSESSEE. THEREFOR E THE APPEAL WAS DECIDED CONSIDERING THE SUBMISSIONS OF THE LEARNED DEPARTMENTAL REPRESENTATIVE AND THE MATERIALS AVAILABLE ON RECOR D. 7 I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE ORDERS OF THE LOWER AUTHORITIES AND THE MATERIALS A VAILABLE ON RECORD. IN THE INSTANT CASE THE ASSESSEE TOOK VOLUNTARY RET IREMENT FROM SERVICES WITH STATE BANK OF INDIA AND WAS PAID EX-G RATIA OF RS.3 44 037/- WHICH WAS CLAIMED DEDUCTION U/S 10(10 C) OF THE ACT RELYING ON THE DECISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. NAGESH DEVIDAS KURKARNI 291 ITR 407 (BOM) AND CIT VS. KOODATHI KALIYATAN AMBUJAKSAN 219 CTR 80 D ECISION OF HON'BLE MADRAS HIGH COURT IN THE CASE OF CIT VS. G V VENUGOPAL 273 ITR 307 (M AD) CIT VS. S SUNDER & OTHERS 284 I TR 687 CIT VS. J RAMAMANI 286 ITR 616 AND CIT VS. M ABDULKARIM 311 ITR 162 AND HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CIT & OTHERS VS. P SURENDRA PRABHU 279 ITR 402 AND KERALA HIGH C OURT IN THE CASE OF STATE BANK OF TRAVANCORE VS. CBDT 282 ITR 5 87. THE LEARNED ASSESSING OFFICER DISALLOWED THE DEDUCTION TO THE ASSESSEE OBSERVING THAT ALL THE DECISIONS RELIED UPON BY THE ASSESSEE ARE OF NON-JURISDICTIONAL HIGH COURTS AND THERE IS NO DIRE CT JUDGMENT OF HON'BLE GUJARAT HIGH COURT. IN APPEAL THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) FOLLOWING THE DECISIONS OF THE HIGH COURTS RELIED UPON BY THE ASSESSEE ALLOWED THE DEDUCTION TO THE ASSESSEE. I 4 FIND THAT THE HON'BLE MADRAS HIGH COURT IN THE CASE OF CIT VS. G V VENUGOPAL 273 ITR 307 HELD AS UNDER: NOTIONS OF EQUITY DO NOT APPLY IN TAXING STATUTES. HENCE IF THE ASSESSEE IS ENTITLED TO TWO BENEFITS ON THE PLA IN LANGUAGE OF STATUTE HE HAS TO BE GRANTED BOTH THOSE BENEFITS. THE SECOND PROVISO TO S. 10(10C) ONLY REFERS TO EXEMPTION CLAI MED IN ANY OTHER ASSESSMENT YEAR. IT IS WELL SETTLED THAT EVER Y ASSESSMENT YEAR IS A SELF-CONTAINED UNIT. THE ASSESSMENT YEAR IN QUESTION IN THE PRESENT CASE IS 2001-02 AND THE EXEMPTION CL AIMED IS IN RESPECT OF THIS ASSESSMENT YEAR ALTHOUGH THE EXEMP TION GRANTED UNDER S. 89(1) HAS BEEN SPREAD OVER SEVERAL ASSESSMENT YEARS. THE MERE FACT THAT THE RELIEF HAS BEEN SPREAD OVER SEVERAL YEARS DOES NOT MEAN THAT THE RELIEF I S NOT IN RESPECT OF A PARTICULAR ASSESSMENT YEAR. THE TRIBUN AL HAS RIGHTLY POINTED OUT THAT IN THE IT ACT THERE ARE S EVERAL PROVISIONS GRANTING TWIN OR DOUBLE BENEFITS WHILE IN OTHER PROVISIONS TWIN OR DOUBLE BENEFITS HAVE BEEN SPECI FICALLY PROHIBITED. THERE IS NO PROHIBITION TO THE TWIN BEN EFITS IN RESPECT OF THE AMOUNT RECEIVED UNDER THE VOLUNTARY RETIREMENT SCHEME. THE WORD SALARY AS DEFINED IN S. 17 INC LUDES ANY PROFIT IN LIEU OF SALARY WHICH HAS BEEN DEFINED IN S. 17(3) TO INCLUDE ANY AMOUNT OF COMPENSATION DUE OR RECEIVED BY THE ASSESSEE FROM HIS EMPLOYER OR FORMER EMPLOYER IN CO NNECTION WITH THE TERMINATION OF HIS EMPLOYMENT. HENCE PAYM ENT UNDER THE VOLUNTARY RETIREMENT SCHEME IS COVERED BY THE W ORD SALARY WHICH HAS BEEN GIVEN A VERY WIDE DEFINIT ION IN S. 17. SINCE THE ASSESSEE IS COVERED BY S. 89 HE WILL GET BOTH THE BENEFITS WHICH HE HAS CLAIMED FOR. APART FROM THE ABOVE IT IS WELL-SETTLED THAT IF TWO REASONABLE INTERPRETATIONS OF TAXING STATUTES ARE POSSIBLE THE ONE IN FAVOUR OF THE ASS ESSEE SHOULD BE ACCEPTED.CIT VS. NAGA HILLS TEA CO. LTD. 1973 C TR (SC) 329 : AIR 1973 SC 2524 APPLIED. 8 FURTHER IN MY CONSIDERED OPINION IF THERE IS A DECISION ON AN ISSUE OF ANY HIGH COURT AND THERE IS NO CONTR ARY DECISION OF ANY OTHER HIGH COURT THEN IN ABSENCE OF THE SAME EVEN IF THERE IS NO DECISION ON THE ISSUE OF THE JURISDICTIONAL HIGH COURT THE DECISION RENDERED BY THE OTHER HIGH COURTS SHOULD B E RESPECTFULLY FOLLOWED BY THE COURTS BELOW THE HIGH COURT. THEREF ORE FOLLOWING THE DECISION OF HON'BLE MADRAS HIGH COURT I DO NOT FIND ANY GOOD REASON TO INTERFERE WITH THE ORDER OF THE LEARNED C OMMISSIONER OF 5 INCOME-TAX (APPEALS). IT IS CONFIRMED AND THE GROUN D OF APPEAL OF THE REVENUE IS DISMISSED. 9 IN THE RESULT THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER SIGNED DATED AND PRONOUNCED IN THE COURT ON 29-01-2010 SD/- (N S SAINI) ACCOUNTANT MEMBER DATE : 29-01-2010 COPY OF THE ORDER FORWARDED TO : 1. SHRI KANAIYALAL VADILAL BHAVSAR VARSHA STATE BA NK STAFF SOCIETY NEAR RAILWAY CROSSING CHANDLODIA AHMEDAB AD 2. THE ITO WARD-15(1) AHMEDABAD 3. CIT CONCERNED 4. CIT(A)-XXI AHMEDABAD 5. THE DR ITAT AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT AHMEDABAD