Sanjeev Chopra Vs ITO (ITAT Chandigarh)
Wrong Return Column Cannot Close the Claim: ITAT Revives ₹13 Lakh Retirement Exemptions
Omitted Exemption Claim Requires Examination on Merits
The Chandigarh ITAT restored a retired employee’s claim for ₹10 lakh gratuity exemption under Section 10(10) and ₹3 lakh leave encashment exemption under Section 10(10AA) to the Assessing Officer for fresh examination.
The exemptions had not been reflected in the prescribed columns of the return. The CIT(A) treated that omission as a procedural barrier and declined relief, relying on Goetze (India) Ltd. v. CIT.
The Tribunal held that, once a specific claim had been raised before the appellate authorities with supporting documents, the omission in the return did not, by itself, remove the requirement to examine its factual and legal merits.
However, the Tribunal expressly refrained from deciding whether the exemptions were ultimately allowable.
CPC Processing Increased Salary Income by ₹13 Lakh
The assessee filed his return for AY 2017-18 declaring total income of ₹95,57,040. The Tribunal records that the return was filed on 30 March 2018.
While processing it under Section 143(1), the CPC did not allow exemption for the gratuity and leave encashment received on retirement.
Consequently, salary income increased from ₹93,13,940 as returned to ₹1,06,13,940 as computed, producing a consequential demand.
