Incentive bonus exemption claim required reconsideration under the Board's direction and the LIC scheme.

The Board's communication stated that the portion of incentive bonus certified as actually incurred in the performance of duties would be exempt under section 10(14)(i) of the Income-tax Act, 1961, and this had to be read with the LIC scheme on record. Because the scheme was not available when the first appeal was decided, the assessee's related claim, including the consequential depreciation aspect, could not be finally determined on the existing material. The matter was therefore remanded to the Assessing Officer for reconsideration in accordance with the Board's direction and the LIC scheme.

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Issues: Whether the assessee's claim for exemption of a portion of incentive bonus as allowance actually incurred in the performance of duties, along with the consequential claim relating to depreciation, required reconsideration in the light of the CBDT direction and the LIC scheme.

Analysis: The Board's communication directed that the portion of the allowance certified as having been actually incurred in the performance of duties would be exempt under section 10(14)(i) of the Income-tax Act, 1961, and this was to be read with the LIC scheme placed on record. As the scheme was not available when the first appeal was decided, the claim could not be finally adjudicated on the existing record.

Outcome: The matter was remanded to the Assessing Officer to reconsider the assessee's claim in accordance with the Board's direction and the LIC scheme, and the appeal was allowed for statistical purposes.

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