What is the meaning of restful services?

What is the meaning of resign from services- date of resigning of date of reliving?

• According to Income Tax department (with reference to leave encashment) what is the meaning of resign from services- date of resigning of date of final reliving?

• Answer:

  With reference to leave encashment, as per Income tax Act, The word ‘retirement or resignation’ has not been used in its sections in the restricted sense to mean ‘retirement on superannuation or resignation’. On the other hand, it is clear from the language of Section (10AA) itself that it has been used in the widest possible terms to mean and include all cases of retirement, whether on superannuation or otherwise. The catchword “Otherwise” also can include retirement What is relevant is ‘retirement’— how it took place is immaterial for the purpose of this clause. Therefore, it is clear that if on retirement, even on resignation by the employee, he/she gets by way of leave encashment any amount, Section 10 (10AA) would apply and the assessee will be entitled to the benefit of the said clause to the extent mentioned therein. This view is supported by the decision of the Madras High Court in the case CIT vs R J Shahney (1986) 54 CTR (Mad) 360. In that case also the assessee had resigned and retired from employment. The high court had held: “The retirement may be of various kinds. It may be on superannuation or voluntary. If there is any voluntary retirement from service, we are satisfied that the provisions of S 10 (10AA) would apply. Regards – [email protected]