Ex-gratia under BSNL Voluntary Retirement Scheme is capital receipt exempt as retrenchment compensation under Section 10(10B).

(i) an amount calculated in accordance with the provisions of clause (b) of section 25F of the Industrial Disputes Act, 1947 (14 of 1947); or

(ii) such amount, not being less than fifty thousand rupees, as the Central Government may, by notification in the Official Gazette, specify in this behalf,]

whichever is less:

(i) the service of the workman has been interrupted by such transfer; or

(ii) the terms and conditions of service applicable to the work-man after such transfer are in any way less favourable to the workman than those applicable to him immediately before the transfer; or

(iii) the new employer is, under the terms of such transfer or otherwise, legally not liable to pay to the workman, in the event of his retrenchment, compensation on the basis that his service has been continuous and has not been interrupted by the transfer;

“The appellant was employee of Department of Telecom Services. The Government of India in its Cabinet meeting dated 23.10.2019 approved the proposals of DOT for revival of BSNL and MTNL vide its Cabinet Note dated 22.10.2019. In its Circular Dated 04.11.2019 the BSNL envisaged a Scheme for effective implementation of VRS and invited options from employees under the scheme for seeking voluntary retirement. Reliance is also placed by the appellant upon the decision of Hon’ble Madras High Court in the case of M/s. Hindustan Photo Film Workers Welfare Centre WP No. 18566 of 2015 dated 17.03.2017. Facts of this case is identical to the case of HTML-TD. Both the entitles were closed in similar situation. Therefore, the provisions of section 10(108) of the Act are clearly attracted in the case of the appellant.

3.10 Further, the decision dated 20.09.2023 of Jurisdictional Hon’ble’ble ITAT Chandigarh A” Bench was also perused wherein several appcals of employees of HTML-TD were taken up. The Hon’ble ITAT opined in para 48 that the matter had been examined by the Hon’ble Madras High Court and thereafter has attained finality in view of dismissal of the SLP by Hon’ble Supreme Court and also added that “such matters need not be litigated any further”.

3.11 Respectfully following the decision of the Jurisdictional Hon’ble ITART and for the reasons mentioned above, the A.O. is directed to allow compensation received by the appellant at the time of VRS as exempt income u/s 10(108) of the Act. Accordingly, Ground No.1 stands Allowed.”

7. Copy of ITAT order has been submitted, this decision dated 20.09.2023 Hon’ble ITAT Chandigarh Bench was perused wherein several appeals of employees of HTML TD were taken up. The Hon’ble ITAT opined in Para 48 that the matter had been examined by the Hon’ble Madras High Court and thereafter has attained finality in view of dismissal of the SLP y Hon’ble Supreme Court and also added that “such matters need not be litigated any further”

8. Respectfully following the decision of the Jurisdictional Hon’ble ITAT, the A.O is directed to allow compensation received by the appellant at the time of VRS as exempt income u/s 10(10B) of the Act. Accordingly, the only one ground raised by the appellant in this appeal is allowed.”

“We have considered the rival submissions and have also gone through the record. The issue is squarely covered by the decision of the Co-ordinate Chandigarh Bench of the Tribunal the Case of other employees in similar facts and circumstances vide order dated 11.3.2019 passed in ITA No.870/Chd/2018 & Others titled as “Sh.Rajeshwar Sharma & Others v. ITO’. This Tribunal observed as under:

Though in strict terms, it may not be said that the amount received by the assessee was on account of commutation of pension, however, the fact on the file is that the aforesaid amount was given by the new employer who has taken over the company from the earlier employer and he had terminated the services of the employees on account of job retrenchment. The amount was paid as a Compensation for retrenchment of services taking into consideration the length of service, basic salary, the age and other factors. In our view, the said amount is a compensation paid by the employer while terminating the services of the employee on account of loss of job and further subsistence, thus, the said a mount was just a capital receipt in the hands of the assessee. In fact, no part of amount received by the assessee is taxable. We, therefore, allow the appeal of the assessee and delete the disallowance and consequent additions made by the Assessing officer in this respect. We further hold that the assessee is entitled to claim refund / adjustment of the tax paid in respect of the aforesaid compensation received, if so, claimed by the assessee.

Following the above decision of the Tribunal in the identical facts and circumstances, this appeal of the appellant stands allowed with identical directions.”

“…In the present case, the delay in filing of the appeal is almost four years which is an inordinate and huge delay. Moreover, as has been elaborately discussed above, the appellant has also failed to provide any reasonable ground that could assist the first appellate authority to draw sufficient cause for the inordinate delay of 1,396 days in filing of this appeal. The inordinate delay in the present case, if condoned, would make the term ”Sufficient cause” in section 249(3) of the Income Tax Act, 1961 hollow and meaningless.

20. In light of the facts of the case, provisions of the Income Tax Act, 1961 and judicial decisions in the matter as discussed above, I am constrained to conclude that the appellant has failed to submit any reasonable ground for condoning the inordinate delay of 1,396 days i.e almost four years in filing this appeal. Being bereft of any sufficient cause as envisaged in section 249(3) of the Act, the appeal cannot be admitted. Since the appeal is not maintainable, there is no need to adjudicate on the merits therein.