Summary
- The ITAT Jaipur has allowed a retired Punjab National Bank employee to claim a leave encashment exemption of ₹7.65 lakh, overturning a previous disallowance.
- The Tribunal ruled that the exemption limit under Section 10(10AA)(ii) of the Income-tax Act, 1961 should apply retroactively, following earlier decisions from its coordinate Benches.
- This decision challenges the restrictive interpretation upheld by the Additional Commissioner of Income Tax (Appeals)-9, which limited the exemption to ₹3 lakh based on Notification No. 31/2023.
- The ruling could set a precedent for similar claims by other retired employees seeking higher leave encashment exemptions under the revised limits.
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