Judgment

VERMA, J.:- This petition under Article 32 of the Constitution challenges the constitutional validity of Cl. (10C) inserted in S. 10 of the Indian Income-tax Act, 1961 (hereinafter referred to as the Act) by the Finance Act, 1987 with effect from 1-4-1987. S. 10 deals with incomes not included in total income for the purpose of taxation under the Act. The effect of Cl. (10C) so inserted in S. 10 of the Act is that any payment received by an employee of a public sector company at the time of his voluntary retirement in accordance with any scheme which the Central Government may, having regard to the economic viability of such company and other relevant circumstances, approve in this behalf, is not included in the total income of such employee resulting in grant of tax exemption to that extent to him. The petitioners contend that the denial of this benefit to an employee of a private sector company at the time of his voluntary retirement amounts to an invidious. distinction between public sector employees and private sector employees in the matter of taxation and is arbitrary and unintelligible amounting to hostile discrimination.

2. The initial submission on behalf of the pet