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TMI Blog2010 (7) TMI 796X X X X Extracts X X X X X X X X Extracts X X X X ..... rievously erred that unsigned notice under section 156 of the Act as appellant filed an appeal indirectly means acceptance of existing demand." 2. Thus the only issue involved in this appeal is about allowability of exemption under section 10(10C) of the IT Act, 1961. 3. Thus facts of the case are that assessee is a Deputy Manager in SBI and has taken VRS on 31-5-2006 under exit option scheme introduced by the Bank of India with effect from 7-5-2005. The assessee received salary and pension amounting to Rs. 3,81,894 (including ex gratia). On examination of Form No. 16 the Assessing Officer noticed that assessee received ex gratia of Rs. 3,07,236 on VRS. He claimed exemption under section 10(10C) ef-the Act. The Assessing Officer disallowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o take a different view. For the sake of convenience we refer to following para from the Third Member judgment in Krishna Gopal Saha's case (supra) as under : "5. At the time of hearing before me, none appeared on behalf of the assessee-respondent. I have, therefore, heard the learned Departmental Representative and perused the material placed before me. I find that the issue has been considered by the Hon'ble jurisdictional High Court in the case of SAIL DSP VR Employees Association 1998 v. Union of India (supra) in which their Lordships held as under : 'Section 10(10C) of the Income-tax Act, 1961, uses the expression 'any amount received by an employee... at the time of his voluntary retirement in accordance with any scheme or schemes o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayment is stretched over a period of years, the same would not become chargeable to tax in any subsequent assessment year.' From the above it is evident that their Lordships of the jurisdictional High Court held that an employee, who takes voluntary retirement, is entitled to deduction under section 10(IOC) even if the payment is stretched over a period of years. They have also held that provision of section 10(10C) should be interpreted in a manner beneficial to the optee for voluntary retirement. It may be pointed out that in the above-mentioned case, the employer i.e., SAIL was of the opinion that the employees were not entitled to exemption under section 10(10C) and accordingly, SAIL had been deducting tax at source on the amount paid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bove it is evident that while the learned AM relied upon the decision of Hon'ble Madras High Court in the case of CIT v. M. Chelladurai & Ors. [2008] 5 DTR (Mad.) 201, he has not taken into account the decisions of other High Courts including the jurisdictional High Court. The Hon'ble jurisdictional High Court under the identical facts held the assessee, i.e., the retired employee, to be entitled to deduction under section 10(10C). Similar view is taken by Hon'ble Bombay as well as Karnataka High Courts. The decision of Hon'ble jurisdictional High Court is binding upon us and moreover if two views are possible, while interpreting the provision, a view which is favourable to the assessee has to be adopted. Hon'ble jurisdictional High Court i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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