9911796707
TMI Blog2025 (3) TMI 991X X X X Extracts X X X X X X X X Extracts X X X X ..... ministry of finance.
Since the leave encashment amount as claimed by the assessee which is below the revised limit of leave encashment exempt prescribed by the Board, the assessee is eligible to claim of deduction of said. Based on these observations the AO is directed to allow the claim of the assessee u/s. 10(10AA) within the revised limit as prescribed. In terms of these observations the appeal of the assessee is allowed.
We held that the assessee is entitled to get the deduction as claimed in the return of income u/s 10(10AA) as the limit has been increased from 3 lac to 25 lacs. Appeal filed by the Assessee is hereby allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... ing as follows: 6.3 In this case, the appellant had claimed the amount of Rs. 15, 93, 539/- as exempt income u/s Sec 10(10AA) as earned leave encashment on retirement. However the Ld AO had restricted the amount of claim to Rs. 3, 00, 000/- and added the remaining amount Rs. 12, 93, 540/- in the order u/s 143(1) of the Act. From the appellant's submission, it is clear that there is no doubt that appellant comes under Sec 10(10AA) (ii) i.e an employee, other than an employee of the Central Government or a State Government as the same had been accepted by the appellant himself. 6.4 Further in his submissions, the appellant had produced calculations of the leave encashment exempted as per provisions of section 10(10AA) of the Act. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... maximum amount receivable by its employees as cash equivalent of leave salary in respect of the period of earned leave at their credit at the time of their retirement, whether superannuation or otherwise, hereby specifies the amount of Rs. 25, 00, 000 (twenty-five lakhs rupees only) as the limit in relation to employees mentioned in that sub-clause who retire, whether on superannuation or otherwise. 2. This notification shall be deemed to have come into force with effect from the 1st day of April, 2023." 6.6 The appellant's case pertains to the Assessment Year 2020-21, therefore, Notification No. 123/2002/F. No. 200/23/98-ITA-I dated 31/05/2002 is applicable in the appellant's case. The appellant's assertion that this notif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred in not adjudicating the raised ground in appeal to the effect that the taxed Leave Encashment amount exceeding Rs 3 lakhs qualifies for relief u/s 891 of the Act. 6 Your appellant craves leave to add amend alter withdraw any ground of appeal 6. None appeared on behalf of the assessee however a written submission filed by the assessee. The contents of the written submission are that it is the obligation of CBDT to issue notification from time to time considering the facts of salary of employee of the Government is not discretionary but mandatory. Undisputedly, the CBDT has failed to issue fresh notification during last two decades. Despite the fact that the salary of the Cabinet Secretary increase from Rs. 30, 000 per month to Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee. The assessee was denied the benefit of Notification No.31/2023/F.No.200/3/2023- ITA-1 dated 24-05-2023 which revised the leave encashment limit to Rs. 25, 00, 000/-. The Co-ordinate Jaipur Bench decision in the case of Govind Chhatwani vs. CIT(A) in ITA No. 385/JP/2023 dated 31.10.2023 held as follows: 7. We have heard the rival contentions and perused the material placed on record. The bench noted that the apple of discord in this case that the assessee has received a sum of Rs. 17, 68, 479/- as leave encashment which was claimed in the return of income filed as exempt u/s 10(10AA) of the Act. The CPC and ld. CIT(A) contended that in the light of this specific notification being not issued the leave encashment allowable up to R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ising inflation. The last drawn salaries have increased manifold since time and notification issued under Clause (ii) of Section 10(10AA) was lastly issued, as taken note of hereinabove, on 31.05.2002. We therefore, issue notice to the respondents limited to this aspect. 9. Issue notice, learned counsel for the respondents accepts notice. Respondents should file counter affidavits be filed within six weeks. Rejoinder thereto, if any, be filed before the next date." 8.1 Recently the Central Board of Direct Taxes Suomotu revised the limit for deduction u/s 10(10AA) of the Act and the revised limit now stood at Rs. 25, 00, 000 as specified vide notification no. 31/2023 issued by the ministry of finance. Since the leave encashment amount as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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