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TMI Blog2016 (6) TMI 929X X X X Extracts X X X X X X X X Extracts X X X X ..... rn of income of the assessee for AY 2004-05 was filed on 06.08.2004 showing returned income of Rs. 26,27,900/-. The return was processed on 21.02.2005. The case was selected for scrutiny. Notices u/s. 143(2) and u/s. 142(1) were duly served on the assessee. In response to these notices, the assessee furnished some necessary documents and explained the contents of the return. The Ld.AO observed that the assessee derived salary from the Hongkong and Shanghai Banking Corporation Ltd. of 21, B. B. D. Bag, Kolkata, and received total Voluntary Retirement Service (in short VRS) benefit of Rs. 25,34,587/- from the same bank during the relevant previous year and claimed exemption of Rs. 5,00,000/- u/s. 10(10C) of the Act. The Ld. AO observed that as per Sec. 10(10C) read with Rule 2BA of the I. T. Rules, an amount not exceeding five lakh rupees out of the amount received by an employee on his voluntary retirement or resignation of his service in accordance with any scheme of voluntary retirement, shall not be included in computing his total income if the amount received does not exceed the amount equivalent to three months' salary for each completed year of service or salary at the time of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s been passed after considering the facts and provisions of Law the Assessing Officer cannot interfere with such an order unless there is a mistake apparent from record. The appellant had chosen to file the petition u/s. 154 instead of an appeal against the said order u/s. 143(3) of the Act. The scope of section 154 is restricted to the issues, which have not been considered and decided in the orders passed u/s. 143(3). Since the issue of granting or otherwise of the exemption u/s. 10(10C) of the Income Tax Act had already been considered and decided by the Assessing Officer after due consideration of facts and law, an amendment as requested by the assessee on the same issue is outside the ambit of section 154 and thus the Assessing Officer has rightly rejected the assessee's application as there was no mistake apparent from the records. There is no scope for the Assessing Officer to change his opinion u/s. 154 of the I. T. Act, 1961. The jurisdiction u/s. 154 is confined to the rectification of the mistakes apparent from the records and it does not envisage the rectification of error of judgment or rectification of a debatable issue where the provisions of facts and law have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase, the issue relates to the Voluntary Retirement Scheme floated by the Hongkong & Sanghai Banking corporation Limited, and the Assessing Officer gave the finding in the assessment order that the scheme was not in conformity with Rule 2BA of the Income Tax Rules, 1962. Hence, there is no error apparent from the records in the order passed by the Assessing Officer. Hence this ground is also dismissed." 4. The assessee preferred rectification petition u/s. 154 of the Act before the Ld. CIT(A) on 10.12.2012 with a prayer seeking to rectify the Ld. CIT(A)'s order on the following basis: i) Forty employees of Hongkong and Sanghai Banking Corporation Ltd. filed appeals to the Hon'ble Income-tax Appellate Tribunal, Kolkata against your order on the identical issue relating to the assessment year 2004-05. The Hon'ble ITAT, "B" Bench, by a consolidated order dated 30th March, 2012 held in favour of those forty employees and vacated orders of the lower authorities. ii) Let us now take note of a Third Member decision of this very Tribunal in the case of DCIT - vs. - Krishna Gopal Saha (121 ITD 368 (TM ) wherein the assessee was a former employee of Standard Chartered Bank and admittedly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons of Hon'ble jurisdictional High Court can be subject matter of rectification under section 154. On this question, we find guidance from Hon'ble Supreme Court's judgment in the case of ACIT - vs - Saurashtra Kutch Stock Exchange Ltd. (305 ITR 227) wherein Their Lordships have held that non-consideration of a judgment of Hon'ble jurisdictional High Court is also a mistake apparent on record, which can be rectified under section 154. What follows, inter alia, is that in a situation in which Hon'ble jurisdictional High Court is not followed, such a non-consideration is clearly a mistake apparent on record. 5. The Ld. CIT(A) disposed of this 154 petition vide his order dated 12.06.2013 by observing as under: "In this case, all relevant points and case laws have been duly considered while passing the appellate order. 3. By moving the rectification application against the appellate order, the appellant has sought to review the said order which is not allowable u/s. 154 of the I. T. Act, 1961. As the relevant case laws were considered and a speaking order was passed, it is held that there is no mistake apparent from record. Hence, there is no merit in the rectification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the respective statutes governing those respective terminal benefits. An expression used in the statute is not always to be interpreted literally or grammatically. Sometimes it has to be interpreted having regard to the context in which the expression is used and having regard to the object and purpose for which the same is enacted. Section 10(10C) was inserted in order to make voluntary retirement attractive so as to reduce human complements for securing economic viability of certain companies. This object was elaborated by various departmental circulars and explanatory statements issued from time to time. Similarly, rule 2BA, which was inserted by the Income-tax (Sixteenth Amendment) Rules, 1992, was amended from time to time. All these go to show that this was intended to make the voluntary retirement more attractive and beneficial to the employee opting for voluntary retirement. Therefore, this has to be interpreted in a manner beneficial to the optee for voluntary retirement, if there is any ambiguity. Therefore, while searching for the meaning of the word "amount received" used in section 10(10C), we are to look into the section itself and rule 2BA as well. Rule 2BA prescr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alance, if any remaining out of taxes already deducted. In case any amount remaining after adjustment, in that event, such amount be refunded to the respective employees within a period of three months of the instalment last payable or within one year from date whichever is later by the concerned authority with whom the tax is lying in deposit. However, the respondent SAIL shall recalculate the amount adjustable or refundable, as the case may be. Such calculation relating to the respective employees shall be furnished by SAIL to the appellant as well as to the income-tax authority within a period of three months from communication. In order to obtain adjustment, the employees shall approach the respondent SAIL and for obtaining refund the employees shall approach the Income-tax Department." 8. We find that the Third Member decision of this Tribunal in the case of Krishnagopal Saha, supra had held that in respect of an assessee who was a former employee of Standard Chartered Bank were admittedly voluntary retirement scheme offered by Standard Chartered Bank was not in conformity with Rule 2BA of the Rules held that assessee was eligible for exemption u/s. 10(10C) of the Act to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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