ITAT Rulings Expand Leave Encashment Tax Relief

Recent rulings by ITAT benches in Jaipur, Agra, and Ahmedabad have held that the ₹25 lakh leave encashment tax exemption, announced in Budget 2023, applies retrospectively. This interpretation allows retirees who left service before 2023 to seek refunds by filing revised returns.

The decision is expected to benefit nearly one million retirees, marking a major relief measure aligned with the government’s broader focus on middle-class welfare and tax fairness.