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2024 (2) TMI 605 - AT - Income TaxExemption u/s. 10(10AA)(i) - Leave encashment received by employees of the Central or State Governments - assessee employed with Indian Railway Catering and Tourism Corporation Limited - Disallowance of exemption claimed u/s. 10(10AA) (i) by holding that the assessee is not an employee of the Central or State Governments - whether the assessee is a Central Government / State Government employee? - HELD THAT - In the light of the above a perusal of the return of income show that the assessee was employed with Indian Railway Catering and Tourism Corporation Limited a Government of India Company and the tax has been deducted at source by the employer. Since the assessee was employed with the Central Government, therefore, she is very much eligible for the claim of deduction u/s. 10 (10AA) of the Act. Appeal filed by the assessee is allowed.
Issues involved:
The issue involves the disallowance of exemption claimed u/s. 10(10AA) (i) of the Act on the grounds that the assessee is not an employee of the Central or State Governments. Summary: Issue 1: Disallowance of exemption claimed u/s. 10(10AA) (i) of the Act The appeal by the assessee was against the order dated 18.05.2023 by NFAC, Delhi pertaining to A.Y. 2019-20. The assessee filed a rectification application u/s. 154 requesting to allow her leave encashment as exempt u/s. 10 (10AA) of the Act, which was restricted by the CPC. The main contention was whether the assessee is a Central Government / State Government employee. The Tribunal found that the assessee was employed with Indian Railway Catering and Tourism Corporation Limited, a Government of India Company, where tax was deducted at source by the employer. As the assessee was employed with the Central Government, she was deemed eligible for the claim of deduction u/s. 10 (10AA) of the Act. Therefore, the appeal filed by the assessee was allowed. In conclusion, the Tribunal ruled in favor of the assessee, allowing the claim of exemption u/s. 10(10AA) (i) of the Act based on the employment status with a Government of India Company.
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