Topic

Leave Encashment Exemption

3 articlesLatest June 2026
Section 10(10AA) & 10(10B) IT Act | BSNL VRS Employees from DoT Entitled to Full Tax Exemption as Central Govt Employees: ITAT Bangalore
Case Law Analysis
|Income Tax Appellate Tribunal

Section 10(10AA) & 10(10B) IT Act | BSNL VRS Employees from DoT Entitled to Full Tax Exemption as Central Govt Employees: ITAT Bangalore

ITAT Bangalore holds that BSNL VRS employees absorbed from the Department of Telecommunications qualify as Central Government employees, entitling them to full tax exemption on leave encashment and ex gratia payments under Sections 10(10AA) and 10(10B) of the Income Tax Act. The ruling clarifies eligibility for tax benefits, impacting thousands of former DoT employees transitioned to BSNL.

Section 10(10AA) IT Act | Delay in Appeal Condoned for Leave Encashment Exemption Under CBDT Notification 31/2023: ITAT Pune
Case Law Analysis
|Income Tax Appellate Tribunal

Section 10(10AA) IT Act | Delay in Appeal Condoned for Leave Encashment Exemption Under CBDT Notification 31/2023: ITAT Pune

ITAT Pune has ruled that delays in filing appeals for leave encashment exemptions under Section 10(10AA) may be condoned when the taxpayer’s claim falls well below the enhanced Rs. 25 lakh limit and the delay stems from genuine hardship, not negligence. This reinforces that procedural rigidity must yield to substantive fairness in tax exemptions, benefiting retired employees navigating complex compliance timelines.

Section 10(10AA) Income Tax Act | IIT Employees Governed by Central Service Rules Entitled to Leave Encashment Exemption : ITAT Delhi
Case Law Analysis
|Income Tax Appellate Tribunal

Section 10(10AA) Income Tax Act | IIT Employees Governed by Central Service Rules Entitled to Leave Encashment Exemption : ITAT Delhi

The ITAT Delhi has ruled that employees of Indian Institutes of Technology, even as autonomous bodies, qualify for tax-free leave encashment under Section 10(10AA) if governed by Central Government service rules. This clarifies that employer status alone cannot override statutory eligibility when service conditions align with central rules, impacting thousands of academic and technical staff across IITs and similar institutions.

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