TMI Blog1985 (6) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 was claimed as exempt. The ITO wanted the assessee to produce evidence and vouchers. The ITO then considered section 10(14) and was of the view that only that amount would be exempt which has been actually spent for meeting out the official duties. He then discussed the duties of the Development Officer and since the assessee did not maintain the details and the vouchers and also referred to the certificate issued by the LIC which categorically provided that for the purpose of tax calculation they have considered Rs. 13,377 as exempt under section 10(14). He, accordingly, disallowed Rs. 12,000 claimed by the assessee. In view of the reasons mentioned by the ITO, the AAC confirmed his order. The AAC did not accept the reasoning provided by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nus also this additional deduction of 40 per cent was claimed and was allowed. He, therefore, pleaded that the assessee is entitled to the deduction of Rs. 25,417 plus Rs. 20,000. He also submitted that the additional ground of claiming this as deductible was raised before the AAC. He relied on the Gujarat High Court decision in the case of CIT v. Cellulose Products of India Ltd. [1985] 151 ITR 499 (FB). 2. Shri Ruhela, the learned departmental representative, on the other hand, submitted that granting of conveyance is one and claim of expenditure on conveyance is another. Shri Ruhela further submitted that the assessee was specifically asked to provide details as well as evidences in support of his claim of expenditure which the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the additional conveyance allowance is granted by the Corporation to the Development Officers to off-set the fuel and other expenses that would have been incurred by the concerned officers during the course of the year to procure new business by contacting proponents, agents and also by extensively touring the area allotted to them. As far as granting of tax exemption is concerned, it appears different tax authorities follow different procedures in different regions. Therefore, it has been decided that the following procedures may be followed for deduction of tax at source at the time of payment of additional conveyance allowance by our offices : (a) Whether the additional conveyance allowance is taxed to the full by the income-tax au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f such a responsibility. This is so in view of its own mentioning that offices are advised to allow the exemption to the extent so treated by the administrators. It further says that different authorities are exempting different amounts. It is an admitted fact that such officers shall get the maximum amount as fixed or arrived at by the employer irrespective of the quantum of expenditure incurred by the employee. The employer has realised that such conveyance allowances have to be provided in the interest of their business, considering the area of jurisdiction under such officers. The amount is calculated as a proportion of the new business developed and the allowance varies in relation to the business developed each month. In our view, cal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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