Leave salary Exemption under Section 10

This query is : Resolved

siddharth (Querist)
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24 July 2007 Dear Caclub user,

Whether a person working with employer other than Central or State government is entitled to Leave salary exemption on leaving the organisation voluntary within eight(8)months of joining it under Section 10(10AA)(ii) of the Income Tax Act?
If possible please provide case law in support of the answer.

Sanjeev Kumar Varshney

Sanjeev Kumar Varshney (Expert)
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25 July 2007 Dear Siddharth

Yes, Leave encashment is elibible for exemption. According to Madras High Court in CIT vs RV Shahney, voluntary retirement from service is a case which comes within the perview of expression" otherwise than superannuation".