Renuka Narasimha Prabhu Vs ITO (ITAT Bangalore)
The appeals concern employees of the Department of Telecommunications and BSNL who received compensation under the BSNL VRS Scheme, 2019. In the case of Renuka Narasimha Prabhu, the assessee received ex gratia compensation of Rs.13,49,010 and had initially claimed exemption of Rs.5 lakhs. The CIT(A) dismissed the appeal as unadmitted after noting a delay of 1,048 days. The assessee subsequently claimed full exemption under Section 10(10B) of the Income-tax Act, 1961 and exemption for accumulated leave encashment of Rs.11,13,585, against which Rs.3 lakhs had been allowed.
In the connected appeal of Jayakumar, the assessee received Rs.10,82,505 as compensation under the BSNL VRS Scheme, 2019. The assessee had originally claimed Rs.5 lakhs exemption under Section 10(10C). The CIT(A) accepted that the scheme was actually a retrenchment scheme but rejected Section 10(10B) exemption on the ground that the assessee was not a workman. The Tribunal considered the decision in Shraddha Pralhad Arote & Ors. v. ITO and other decisions relied upon by the assessee.
The Tribunal noted that Jayakumar had been retrenched under the BSNL VRS Scheme, 2019, which formed part of the revival and restructuring plan for BSNL approved by the Union Cabinet on 23.10.2019. The scheme was operated through the Department of Telecommunications Office Memorandum and funded by the Central Government.
