TMI Blog2016 (9) TMI 1148X X X X Extracts X X X X X X X X Extracts X X X X ..... ting aside order in question passed under sec. 263 of the Act restore the assessment order granting the above relief on the receipt of ₹ 5 lacs as compensation. The grounds involving the issue of validity of revisional order passed under section 263 of the Act are accordingly allowed in favour of assessee - ITA No. 2628/Del/2011 - - - Dated:- 16-8-2016 - SHRI I.C. SUDHIR AND SHRI L.P. SAHU For The Assessee : Shri Kapil Goel, Adv. For The Department : Shri N.C. Swain, CIT(DR) ORDER PER I.C. SUDHIR: JUDICIAL MEMBER The assessee has questioned revisional order passed by Learned CIT on the following grounds: 1. That the Learned CIT-XV, New Delhi has erred in law and facts of the case in passing the order dated 03.03.2011 under sec. 263 of the Income-tax Act, 1961. The order of assessment made under sec. 143(3) dated 16.10.2008 at income of ₹ 1,17,391 was not erroneous order, therefore, the action of the Learned CIT-XV, New Delhi under sec. 263 is uncalled for and the order passed u/s. 263 deserved to be cancelled. 2. That the Learned CIT-XV, New Delhi has wrongly and illegally directed the Assessing Officer to make addition of ₹ 5, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... protect the status and service of the assessee by its order, that preparatory school cannot terminate the services of the assessee, as the management of dispute was different from that of original appointee management in Srinivaspuri School. Due to harassment by the school to the assessee, the assessee accepted the offer of the school to resign from his service. The issue was settled and the management offered voluntary retirement compensation of ₹ 5 lacs to the assessee. If the assessee would not have sought early voluntary retirement, he would have retired in the year 2025. The post of the assessee as head clerk was recognized by the Directorate of education as a permanent post. The management agreed that the assessee should be compensated with early voluntary retirement and Rs. 5 lacs in lieu thereof was paid as a settled amount to the assessee. This settlement between the school management and the assessee was duly recorded by the Hon'ble High Court to avoid any further litigation and counter claims by either party in whatsoever circumstances. The assessee filed his income-tax return and the said sum of ₹ 5 lacs was included in Form 16 duly attached with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which require be amended on allowing reasonable opportunity. 4.2 The Learned AR further contended that if two views are possible while interacting the provisions, a view which is favourable to the assessee has to be adopted. He submitted that the Hon'ble Calcutta High Court in the case of SAIL DSP (V.R employees Association 1998 vs. Union of India (2003) 262 ITR 638 (Cal.) has been pleased to hold that the provisions of sec. 10(10c) are t o be interprettred liberally in a manner which is beneficial to retired employee. He placed reliance of the following decisions: i) CIT Sourastra Cement Ltd. (2010) 325 ITR 422 (SC); ii) Anunbhai R. Naik vs. ITO, /tax appeal No. 23 of 2004- judgment dated 12.10.2015 (Hon'ble Gujarat High Court iii) CIT vs. Sharda Sinha 471 ITR (2003) order dated 22.12.2015 (Delhi High Court). 5. The Learned CIT(DR) on the other hand placed reliance on the revisional order in question. He submitted that the decisions cited by the Learned AR having distinguishable facts are not helpful to the assessee. He submitted that the assessee was not eligible for claiming exemption under sec. 10(10C) of the Act as he was not fulfilling all the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... discharge of an employee for sufficient reasons by the competent appointing authority after giving three months notice in writing in that behalf or by payment of three months basic pay and Dearness Allowance as in force from time to time in lieu of such notice. Against the order of termination, the assessee preferred an appeal to the higher authority in the company, but did not succeed. He, therefore, approached this court by way of a writ petition under Article 226 of the Constitution of India being Special Civil Application No.5039/1984 challenging the discharge. The said petition came to be allowed by the learned Single Judge holding that (1) the employer was a State within the meaning of Article 12 of the Constitution, and (2) the order of discharge was by way of a punishment and the assessee was entitled to reinstatement of his services. The employer challenged the order in letters patent appeal before a Division Bench of this court, which held that the employer - Gujarat State Fertilizer Company Limited was not a State or authority under Article 12 of the Constitution and allowed the appeal. However, the court recorded the agreement arrived at between the parties as reprod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act. The Tribunal was, therefore, not justified in holding that the amount of ₹ 3,51,308/- received by the appellant pursuant to the judgment of the High Court was income liable to tax under section 17(3) of the Act. 13. The question stands answered accordingly, in favour of the appellant assessee and against the revenue. The appeal is accordingly allowed. The impugned order passed by the Tribunal is hereby quashed and set aside and the order passed by the Commissioner (Appeals) deleting the addition made by the Assessing Officer is, hereby restored . In the above decision of the Hon'ble Gujarat High Court, a reference of the decision of Hon ble jurisdictional High Court of Delhi in the case of CIT vs. Deepak Verma (2011) 339 ITR 475 (Del.) has also come. The Hon'ble Gujarat High Court has been pleased to note the observation of Hon'ble Delhi High Court in the above cited case on the word compensation . The Hon'ble Delhi High Court has been pleased to observe that the word compensation is not defined under the Income-tax Act, 1961. Therefore, one has to take into consideration the ordinary connotation of this expression in common parlance. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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