TMI Blog2010 (7) TMI 796X X X X Extracts X X X X X X X X Extracts X X X X ..... HELD THAT:- In the case of SAIL DSP VR Employees Association 1998 v. UOI [ 2003 (2) TMI 46 - CALCUTTA HIGH COURT] held as under Sums paid on voluntary retirement to the extent of rupees five lakhs are exempted from being charged to tax by reason of section 10(10C). Even if the payment is stretched over a period of years, the same would not become chargeable to tax in any subsequent assessment year. They have also held that provision of section 10(10C) should be interpreted in a manner beneficial to the optee for voluntary retirement. Similarly, In the case of CIT v. P. Surendra Prabhu[ 2005 (9) TMI 67 - KARNATAKA HIGH COURT] held that the assessee, employee of the respondent bank was not only entitled to the benefit of exemption u/s 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t assessee received ex gratia of Rs. 3,07,236 on VRS. He claimed exemption under section 10(10C) ef-the Act. The Assessing Officer disallowed the claim by following Circular No. Chief CIT, Baroda letter BRD/Chief CIT/Tech/MICS/10(10C)/2009-10, dated 17-6-2006. The assessee relied on the decision of Tribunal, Kolkata in the case of Dy. CIT v. Krishna Gopal Saha [2009] 121 ITD 368 (Kol.) (TM) 385 but the learned Assessing Officer did not agree and made the addition. The learned CIT(A) also confirmed the disallowance by trying to distinguish the decision of Third Member in Krishna Gopal Saha s case ( supra ). 4. We have heard the parties and perused the material on record. In our considered view the distinction cited by the learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f 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 of voluntary retirement ....if a plain literal interpretation of statutory provision produced a manifestly absurd and unjust result, which the legislature could not have intended, the Court is supposed to modify the language used by the legislature even to do some violence to it so as to achieve the obvious intention of the legislature and produce a rational construction. An expression used in the statute is not always to be interpreted literally or grammatically. Sometimes it has to be interpreted having regard to the context in which the expression is used and having regard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 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 under their voluntary retirement scheme. The facts are similar in the assessee s case, because in the case of the assessee also, the employer believing that the assessee is not entitled to deduction under section 10(10C) has deducted tax at source on the amount paid on voluntary retirement. The facts being identical, the above decision of Hon ble jurisdictional High Court would be squarely applicable to the case under appeal before the Tribunal. 6. Similarly, Hon ble Bombay High Court in the case of CIT v. Nagesh Devidas Kulkarni ( supra ) held as under : The as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 in the above-referred case of SAIL DSP VR Employees Association 1998 v. Union of India ( supra ) has also held that the provisions of section 10(10C) are to be interpreted liberally in a manner which is beneficial to retired employees in view of the above. I respectfully following the decisions of Hon ble jurisdictional High Court, Bombay High Court and Karnataka High Court agree with the learned JM and hold that the assessee is entitled to exemption under section 10(10C) to the extent of Rs. 5 lakhs." Respectfully following the above decision ..... X X X X Extracts X X X X X X X X Extracts X X X X
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