Claim for exemption u/s 10(10B) though not claimed in return, can be raised during proceedings before CIT(A) or the Tribunal.
In a recent judgment, the ITAT Chandigarh has held that claim for exemption u/s 10(10B) for compensation received on forced retrenchmen, though not claimed in return, being a legal claim, can be raised during the proceedings before the CIT(A) as well as before Tribunal.
ABCAUS Case Law Citation:
4331 (2024) (11) abcaus.in ITAT Chandigarh
In the instant case, the assessee had challenged the order passed by the CIT(A) in not considering the additional claim for exemption u/s 10(10B) of compensation received on forced retrenchment under VRS on closure of the empoyment instead of exemption u/s 10(10C) of the Income Tax Act, 1961.
Before the Tribunal the assessee submitted that the matter is squarely covered by the decision of Coordinate Bench.
In her rejoinder, the assessee submitted that even though the said claim was not made by the assessee while filing the return of income, at the same time, as soon as the assessee was ceased of the matter that he is eligible for such claim, he has raised the said claim as part of the grounds of appeal before the CIT(A) and it was submitted that where all facts are on record, the CIT(A) ought to have examined the said claim being a legal claim and allowed the necessary relief to the assessee more so, where similar claim has been allowed by the CIT(A) in other cases.
The Tribunal expressed agreement with the contention of the assessee that whether the assessee is eligible for deduction u/s 10(10B) or not, being a legal claim, the said claim can be raised during the proceedings before the ld CIT(A) as well as before this Tribunal. Further, on merits, the facts were pari-materia and the matter relating to exemption under section 10(10B) has been extensively discussed by the Coordinate Bench.
FOloowing the legal precent, the ITAT held that the assessee was eligible for exemption under section 10(10B) on whole of the amount received on VRS compensation and the AO was directed to allow the necessary relief to the assessee.
In the result, the ground of appeal of the assessee was allowed.
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