Pradeep Hegde Vs ITO (ITAT Bangalore)
Bangalore ITAT Allows Full Exemption for BSNL VRS Compensation
The Bangalore ITAT in the case of Pradeep Hegde v. ITO allowed the assessee’s claim for exemption of BSNL VRS ex-gratia compensation and condoned an extraordinary delay of more than 1,400 days in filing appeals. The Tribunal held that substantial justice should prevail over procedural delays, especially where the assessee acted on professional advice and subsequently became aware of favourable judicial precedents.
The assessee, a former Department of Telecommunications employee absorbed into BSNL, had received ex-gratia amounts under the BSNL Voluntary Retirement Scheme, 2019. The CPC and CIT(A) denied full exemption and the CIT(A) refused to condone the delay in filing appeals. However, the Tribunal relied on earlier decisions of the Pune, Ahmedabad and Chandigarh Benches holding that compensation received under the BSNL VRS was in the nature of retrenchment compensation eligible for exemption under section 10(10B) and not merely the limited exemption under section 10(10C).
Following the consistent view of coordinate benches, the ITAT held that the ex-gratia compensation received under the BSNL revival package was exempt from tax, directed the Assessing Officer to grant the exemption and consequential refund after verification, and ordered implementation within 90 days. Both appeals of the assessee were accordingly allowed.
FULL TEXT OF THE ORDER OF ITAT BANGALORE
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