TMI Blog2001 (2) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... ance under section 40A(5) of the Act? 3. Whether all the tours undertaken by a person during the year were to be grouped together and only thereafter the limits laid down in rule 6D be applied?" We have heard Mr. B.B. Naik, learned counsel for the Revenue, instructed by M.R. Bhat and Co. Though served, none appears for the respondent-assessee. At the hearing of this reference, Mr. Naik points out that the issue regarding reimbursement of medical benefits is covered by the decisions of this court in Gujarat Steel Tubes Ltd. v. CIT [1994] 210 ITR 358 and Ambica Mills Ltd. v. CIT [1999] 235 ITR 264, wherein this court has taken the following view: "As regards the medical expenses which were reimbursed to the directors by the assessee, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts to the director. A similar view has been taken in respect of payment of house rent allowance to the employees of the company in the context of section 40A(5) of the Act. We accordingly hold that house rent allowance paid to the managing directors has to be considered for computing disallowance under section 40(c) of the Act. Coming to question No.2, in view of the aforesaid decision dated February 5, 1997, in Income-tax Reference No. 27 of 1984 (CIT v. Saraspur Mills Ltd. [2002] 254 ITR 522 (Guj) (Appx.)), it has to be held that house rent allowance paid to the employees of the company is to be considered for the purpose of computing the disallowance under section 40A(5) of the Act. Coming to question No.3, Mr. Naik submits that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oyee during a year are not to be grouped together and that the limits laid down in rule 6D have to be applied with reference to each trip of an individual employee. In view of the above discussion, we answer the questions as under: Question No.1 is answered in the affirmative, i.e., in favour of the Revenue and against the assessee. Question No.2 is answered in the affirmative, i.e., in favour of the Revenue; and Question No.3 is answered in the negative, i.e., in favour of the Revenue B and against the assessee. We hold that the limits laid down in rule 6D have to be applied with reference to each trip of an individual employee. The reference accordingly stands disposed of with no order as to costs. - - TaxTMI - TMITax - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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