Retired PSU bank employee claimed Rs 9.29 lakh leave encashment as tax-free, but taxman restricted exemption to Rs 3 lakh; ITAT applies Rs 25 lakh limit retrospectively, cancels Rs 6.29 lakh addition
Leave encashment is tax-free up to a limit for non-government employees. While the limit was earlier Rs 3 lakh, it was revised to Rs 25 lakh in 2023.