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2016 (5) TMI 1144 - ITAT CHENNAI

2016 (5) TMI 1144 - ITAT CHENNAI - TMI - Reopening of assessment - salary income - addition on repayment of sign on bonus back - whether the provision of Act permit deduction were the assessee voluntarily resigned from Barclays Bank and joined Deutsche Bank violating the pre-conditions of employment to stay with Barclays Bank for a period of one year? - Held that:- The assessee has received the amount during his employment and there exists employer and employee relationship and sign-inbonus cann .....

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d for refund of sign-on-bonus. On the perusal of provisions of Sec. 17(1) of the Act, there are no explanation were assessee should reduce refund of sign-on-bonus. Considering the apparent facts, terms of employment, characteristic of sign on bonus and the service certificate of Barclays Bank were assessee has voluntarily left the service. We are of the opinion that ld. Commissioner of Income Tax (Appeals) has examined the issue in detail based on the observations of the Assessing Officer and th .....

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der of the Commissioner of Income-tax (Appeals)-IV, Chennai in ITA No.809/13-14, dt 0310.2014 for the assessment year 2008-2009 passed u/s 143(3) r.w.s.147 and 250 of the Income Tax Act, 1961 (herein after referred to as the Act ). 2. The assessee has raised only one substantive ground as under:- To direct the Assessing Officer to delete the addition made of 25,00,000/- in the reassessment, on repayment of sign on bonus back to M/s. Barclays Bank, as this receipt does not constitute income. 3. T .....

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s not offered salary income of ₹ 25,00,000/- in the return of income. Further notice u/s.148 of the Act was issued and in compliance to notice, the ld. Authorised Representative of the assessee filed return of income on 19.07.2011 and appeared in hearing proceedings from time to time and submitted information for verification. The assessee is a employee of Barclays Bank during the financial year 2007-08 from 01.04.2007 to 31.10.2007 and received salary income of ₹ 13,46,943/- after r .....

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e year from the date of joining, he shall refund the sign-on-bonus. Considering the facts, the assessee has left Barclays Bank and joined Deutsche Bank and refunded the amount of ₹ 25,00,000/- as acknowledged by Barclays Bank on 06.11.2007. The assessee filed return of income for assessment year 2007-08 and offered sign-on-bonus for taxation since the assessee has refunded an amount of ₹ 25,00,000/- on 06.11.2007 which falls in the financial year 2007-2008 relevant to assessment year .....

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iled an appeal before Commissioner of Income Tax (Appeals). 4. In the hearing proceedings, the ld. Authorised Representative of the assessee argued on the grounds and submitted proofs pertaining to sign-on-bonus. The ld. Commissioner of Income Tax (Appeals) considered written submissions on facts and interpretation of laws and concurred with findings of the Assessing Officer and dismissed the appeal observed at 18 of the order as under:- 18. In view of the above discussion, I find no infirmity i .....

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e Tax (Appeals) order, the assessee filed an appeal before Tribunal. 5. Before us, the ld. Authorised Representative vehemently argued and substantiated with documentary evidence. The only disputed issue being deletion of addition of ₹ 25,00,000/- by the ld. Assessing Officer, were the said amount was repaid back to Barclays Bank which fall in current financial year. The ld. Authorised Representative filed paper book, written submissions explaining the circumstances of employment, taxabili .....

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o filed written submissions and opposed the grounds of the appeal. 7. We heard the rival submissions, perused the material on record and judicial decisions cited. The ld. Authorised Representative only disputed issue being sign-on-bonus should be allowed as deduction from the gross salary since it was repaid and offered to tax in assessment year 2007-08. The issue revolved around whether the provision of Act permit deduction were the assessee voluntarily resigned from Barclays Bank and joined De .....

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