House rent allowance exemption denied where the assessee lived in own house and incurred no rent expenditure.

Section 10(13A) does not allow house rent allowance exemption where the residential accommodation is owned by the assessee or where no rent expenditure has actually been incurred. The retrospective Explanation inserted by the Taxation Laws (Amendment) Act, 1984 specifically excludes such cases. On the admitted facts, the assessee lived in his own house and did not pay rent, so the statutory exclusion applied and the exemption was unavailable. The issue was answered against the assessee and in favour of the Revenue.

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Issues: Whether the assessee was entitled to exemption under section 10(13A) of the Income-tax Act, 1961 in respect of house rent allowance while residing in his own house and without actually incurring rent expenditure.

Analysis: Section 10(13A) was amended retrospectively by the Taxation Laws (Amendment) Act, 1984 by inserting an Explanation which specifically excludes cases where the residential accommodation is owned by the assessee or where no expenditure on rent has actually been incurred. On the admitted facts, the assessee neither paid rent nor occupied rented accommodation, so the statutory exclusion applied.

Conclusion: The assessee was not entitled to the exemption under section 10(13A); the question was answered against the assessee and in favour of the Revenue.

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