Sharad Shukla Vs ITO (ITAT Agra)
The appeal before the Income Tax Appellate Tribunal (ITAT), Agra, related to Assessment Year 2020-21 and arose from an order of the Addl./Joint Commissioner of Income Tax (Appeals), NFAC, Delhi, concerning an intimation issued under Section 143(1) of the Income Tax Act. There was a delay of 59 days in filing the appeal, which was condoned by the Tribunal.
In the intimation under Section 143(1), the exemption claimed under Section 10 was restricted to ₹20.93 lakh by disallowing leave encashment of ₹4.50 lakh. The adjustment was made on the ground that the assessee was not a government employee. The assessee contended that the entire leave encashment amount of ₹7.50 lakh was exempt under Section 10(10AA) and that the exemption should not have been restricted to ₹3 lakh.
The CIT(A) rejected the assessee’s claim, following which the matter was carried in appeal before the Tribunal. The assessee relied upon CBDT Notification No. 31/2023, which enhanced the leave encashment exemption limit to ₹25 lakh, and also referred to certain decisions of the Tribunal and the Delhi High Court in support of the claim. A grievance regarding lack of opportunity of hearing was also raised.
Considering these submissions, the Tribunal restored the matter to the file of the CIT(A) for fresh adjudication. The assessee was directed to substantiate the claim before the appellate authority. The appeal was allowed for statistical purposes.
