Salary exemptions and house property interest deduction must fit statutory limits, with leave travel allowance requiring factual verification.

Salary-related deductions and exemptions must fall within the statutory allowance framework and be factually supported. The medical expense claim was accepted, but claims for food, telephone, conveyance and similar exemptions were treated as outside the permitted salary exemption provisions and were disallowed. Leave travel allowance required fresh factual verification on eligibility and its treatment in gross salary, so that aspect was remanded for reconsideration. Interest claimed against house property income was restricted to the statutory ceiling applicable to self-occupied property, and the excess deduction was disallowed.

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Issues: (i) Whether the assessee was entitled to deduction for claimed salary-related expenses and allowances, including leave travel allowance, food, medical, telephone, conveyance and other exemptions. (ii) Whether the disallowance of interest claimed under the head income from house property was justified.

Issue (i): Whether the assessee was entitled to deduction for claimed salary-related expenses and allowances, including leave travel allowance, food, medical, telephone, conveyance and other exemptions.

Analysis: The salary income as disclosed in the revised return was lower than the salary reflected in Form 26AS and Form 16 because the assessee had claimed various deductions and exemptions. The medical expense claim was accepted, but the remaining items were found not to fall within the scope of the statutory salary exemption provisions. The claim relating to leave travel allowance required factual verification as to eligibility and treatment in the gross salary computation, so that component needed fresh examination.

Conclusion: The issue was partly remanded for reconsideration only in respect of leave travel allowance, while the claims for food, telephone, conveyance and other exemptions were disallowed.

Issue (ii): Whether the disallowance of interest claimed under the head income from house property was justified.

Analysis: The assessee claimed interest deduction against house property income in excess of the statutory ceiling applicable to self-occupied property. The lower authorities restricted the allowance to the maximum permissible amount and disallowed the balance. No infirmity was found in that approach on the facts recorded.

Conclusion: The disallowance under the head income from house property was upheld.

Final Conclusion: The appeal succeeded only to the limited extent of remand on the leave travel allowance issue, while the remaining additions and disallowances were sustained.

Ratio Decidendi: Salary-related exemptions must fall within the statutory allowance provisions and be supported by facts, while interest on house property cannot exceed the prescribed deduction limit for the relevant property category.

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