Commissioner of Income Tax vs R.J. Shahney

V. Ramaswami, J.—The question that sought is to be referred to this case is as follows :

Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that the provisions of section 10(10AA)

would apply to the assessee''s case in respect of the encashment of leave salary even though the payment was received not at the time of his

retirement but at the time of resignation of his employment from Jessop and company ?

Under the provisions of section 10(10AA), the payment received by an employee as cash equivalent to leave salary in respect of the period of

earned leave to his credit at the time of his retirement whether on superannuation or otherwise, shall not be included in computing the total income.

In this case, the assessee resigned and retired from the employment. Learned counsel for the Revenue sought to contend that since the words

Whether on superannuation or otherwise"" qualifies retirement, unless it is a case of retirement from service on attaining a particular age, or on

some other reason, a case of resignation will not take in. We are unable to agree. The retirement may be of obvious kinds. It may be on

superannuation or it may be voluntary. If there is any voluntary retirement from the service, we are satisfied that the provisions of section

10(10AA) would apply. Therefore, no question of law could be said to arise out the order of the Tribunal. The petition is accordingly dismissed

with costs. Counsel''s fee Rs. 250.