Fired employee gets Rs 26 lakh severance pay, but didn’t pay income tax; loses tax battle in ITAT Hyderabad for this key reason
On November 19, 2025, the Income Tax Appellate Tribunal (ITAT) in Hyderabad decided that any severance package an employee receives from their employer after their employment ends, whether in lump sum or otherwise, will be treated as profits in lieu of salary and thus subject to income tax.