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TMI Blog2017 (6) TMI 165X X X X Extracts X X X X X X X X Extracts X X X X ..... was present on behalf of the assessee neither any adjournments was sought. 3. Facts of the case in brief are that the assessee was an employee of Choudhary Charan Singh, Haryana Agricultural University, Hisar and received arrear of Death cum retirement gratuity of Rs. 6,50,000/-. The assessee filed the return of income on 11.05.2012 declaring an income of Rs. 5,27,880/- which was processed u/s 143(1) of the Act on the returned income. The AO observed that the assessee in the computation of total income, annexed with the return of income, furnished the details of receipt of arrears of gratuity and the detailed note on payment of Gratuity, Leave Encashment and LTC etc. The AO did not allow the claim of the assessee for exemption of Rs. 10,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t under a state and are not eligible for exemption u/s. 10(10)(i) of Income Tax Act. They are not covered by Section 10(10)(ii) as they are not receiving gratuity under the payment of gratuity Act, 1972. Hence, employees of the University are covered U/s. 10(10)(iii) of I.T. Act for which there is limit on the gratuity amount allowable. CBDT has approved the notification of Rs. 10 lakhs on the maximum amount of gratuity u/s. 10(10)(iii) of Income Tax Act vide its notification no 43/2010 dated 11.06.2010. This notification is applicable to employees who retire on or after 24.05.2010. Before 24.05.2010 the exemption u/s. 10(10)(ii) was restricted to Rs. 3,50,000/-. Therefore, I hold that the appellant who retired before 24.05.2010 is eligible ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... receipt of gratuity amount and leave encashment. In so far as the addition on account of gratuity received by the assessee amounting to Rs. 6,50,000/- is concerned, it is found that the case of the assessee is that this amount falls u/s 10(10)(i) of the Act. On the contrary, the Revenue has treated it as a case falling u/s 10(10)(iii). In order to appreciate the rival contentions in right perspective, it will be apposite to set out the relevant parts of section 10, as under :- "(10) (i) any death-cum-retirement gratuity received under the revised Pension Rules of the Central Government or, as the case may be, the Central Civil Services (Pension) Rules, 1972, or under any similar scheme applicable to the members of the civil services of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax under this clause shall not exceed the limit so specified as reduced by the amount or, as the case may be, the aggregate amount not included in the total income of any such previous year or years.' 5. A careful perusal of the above provision indicates that if a case falls under clause (i) of section 10(10), the entire amount of death-cum-retirement gratuity becomes exempt. Au contraire, if a case falls under sub-clause (iii) of section 10(10), then, the exemption is limited to the amount as the Central Government may notify in official gazette. It is an accepted position that the Notification u/s 10(10)(iii) issued on 24.5.2010 raised the ceiling of exemption from Rs. 3,50,000/- to Rs. 10 lac. Since the original amount was received by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . As the assessee's pension has been computed under Civil Services Rule, it goes to show that the assessee was holding a 'civil post' at the time of his retirement. No other contrary material has been placed on record by the ld. DR to show that the assessee was holding a post other than civil post. 7. The second requirement is that such civil post must be under a State. Page 20 of the paper book is a copy of Haryana and Punjab Agricultural University Act, 1970, which was passed by the Parliament and received the assent of the President on 2nd April, 1970. Under this Act of Parliament, two independent agricultural universities in place of the hitherto Punjab Agricultural University, were established. Section 5 of this Act sets out the nam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st under a State, in my considered opinion, the provisions of section 10(10)(i) are fully attracted in this case entitling him to exemption for the amount under consideration. Once a case falls under clause (i) of section 10(10), the same cannot be brought within the purview of clause (iii) of section 10(10). I, therefore, hold that the assessee is entitled to exemption u/s 10(10)(i) in respect of gratuity amount received in total upto Rs. 10 lac, which covers a sum of Rs. 6,50,000/- received during the year. Overturning the impugned order on this score, I allow exemption u/s 10(10)(i) to the arrears of gratuity received by the assessee at Rs. 6,50,000/- during the instant year. 9. As regards the second amount of Rs. 1,88,720/- received ..... X X X X Extracts X X X X X X X X Extracts X X X X
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