Devi Dutt Agarwal Vs Assessment Unit (ITAT Jaipur)
Income Tax Appellate Tribunal (ITAT), Jaipur Bench, decided the appeal of an individual assessee against the order of the NFAC, Delhi, regarding the exemption claim for leave encashment under Section 10(10AA) of the Income-tax Act, 1961. The assessee filed the original return declaring total income of ₹20,94,750 and subsequently filed a revised return of ₹11,81,550, claiming full leave encashment exemption of ₹12,13,200 under Section 10(10AA). In the original return, the assessee had claimed only ₹3,00,000 as exempt. The Assessing Officer (AO) disallowed the excess claim of ₹9,13,200 and added it back to the income, treating the assessee as a non-Central/State Government employee. The Commissioner of Income Tax (Appeals) confirmed the AO’s order.
The assessee appealed before the ITAT, contending that the CBDT Notification No. 31/2023 enhanced the leave encashment exemption limit from ₹3,00,000 to ₹25,00,000 under Section 10(10AA)(ii), making him eligible for full exemption. The assessee also cited judicial pronouncements, including the Delhi High Court’s decision in Kamal Kumar Kalia & Ors. vs. Union of India and ITAT Jaipur Bench decisions in Ram Charan Gupta vs. ITO and Govind Chhatwani vs. CIT, supporting the application of the revised exemption limit.
The ITAT observed that the appeal was filed beyond the prescribed time limit by 326 days. The assessee, aged 66, submitted a request for condonation of delay, citing severe eye trauma and surgeries in 2024 that prevented him from accessing e-mails and departmental notices. The Tribunal found the explanation reasonable and condoned the delay.
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