TMI Blog1985 (11) TMI 101X X X X Extracts X X X X X X X X Extracts X X X X ..... n in India. He was paid daily living expenses within the monetary limit sanctioned by the Reserve Bank of India. The daily living expenses were received by the assessee from Batliboi Co. Ltd., Bombay. In the original assessment orders, the ITO added 50 per cent of daily living expenses received by the assessee from Batliboi Co. Ltd. to the salary income received from Czechoslovakian employer. The assessee accepted the said inclusion. However, the Commissioner in exercise of his powers, under section 263 of the Income-tax Act, 1961 ('the Act') directed the ITO to make addition of the full amount of daily living expenses in the place of 50 per cent of such expenses made in the original order. The assessee has now come in appeals before us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal assessment orders were passed, the said Explanation which is retrospective in operation shall now have to be considered. In the present case, the Indian company, viz., Batliboi Co. Ltd., has not paid any remuneration as such to the assessee. The assessee had come to India for doing certain job work on behalf of his employer, who was a Czechoslovakian company. In order to reimburse his local expenses in India, Batliboi Co. Ltd., had paid the amount in question to the assessee. The Reserve Bank of India had granted permission to pay local living expenses not exceeding Rs. 600 per day. Batliboi Co. Ltd., by letter dated 24-5-1979 had agreed to pay local living expenses, as also his internal travel expenses on company's business at ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly, necessarily and exclusively incurred in the performance of the duties of the employee of foreign employer. The said amount was not in the nature of in entertainment allowance or other perquisites within the meaning of clause (2) of section 17 of the Act. Consequently, to the extent to which the said expenses were actually incurred for the said purpose, the amount was exempt from inclusion in the total income. The ITO had already disallowed 50 per cent of the amount on the ground that the details could not be produced. The remaining 50 per cent was exempt under section 10(14). 4. We do not agree with the contention of the learned departmental representative, that Explanation to clause (14) would be applicable on the facts of the prese ..... X X X X Extracts X X X X X X X X Extracts X X X X
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