TMI Blog1989 (5) TMI 82X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee was an employee of Shri Arbuda Mills Ltd. He had a massive coronary infraction and so he resigned. Thereupon he was paid the aforesaid sum. The ITO rejected the assessee's claim on the ground that the assessee's ill-health was only a temporary phase requiring rest to recovery and not a permanent state leading to his not being able to do any work. According to the ITO the doctor had adv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpt under s. 10(13)(ii). 3. Before us the learned Departmental Representative argued that the assessee had not been incapacitated, which was required under the said provision. The assessee's counsel pointed out that the salary in the earlier employment was Rs. 8,000 whereas the salary in the new post was only Rs. 4,300 which showed that the assessee was not able to do any strenuous work. The as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore retirement. If this employee would not have had the misfortune of being incapacitated sometime before the retirement date he would have had this benefit of exemption. Secondly an employee who retires in the normal course would get this exemption even though after retirement he may take on another employment. Therefore, in our view the word "incapacitated" here has to be interpreted to mean th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e took another employment subsequently in June, 1983. But that does not mean that the assessee was not incapacitated at the time when he resigned. We cannot overlook, the fact that it was not in the assessee's financial interest to forego a much higher salary than the one which he was getting in the subsequent employment. Therefore, the genuineness also of the assessee's case regarding his incapac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 's credit "at the time of retirement, whether on superannuation or otherwise". He submitted that resignation was not covered by this expression. The assessee's counsel relied upon the decision of the Madras High Court in the case of CIT vs. R.J. Shahney (1986) 54 CTR (Mad) 360 : (1986) 159 ITR 160 (Mad). According to this decision the provisions of s. 10(10AA) are applicable even in case of volunt ..... X X X X Extracts X X X X X X X X Extracts X X X X
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