1978 (7) TMI 143

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....llowance of Rs. 12 on a working day at the headquarters and Rs. 24 per day when he was away from it. The assessee claimed deduction of Rs. 600 under s. 16(1) for the asst. yr. 1974-75 and Rs. 3,500 for the asst. yr. 1975-76 under the same section. The ITO appears to have rejected the claim of the assessee without assigning any reasons. However, when the matter came up on appeals, the AAC considered the issue at length and found that the assessee was, as a matter of fact, in receipt of only a "working allowance". Hence, it was held that the assessee was not in receipt of any conveyance allowance as contemplated under s. 16(1) of the Act. In this view of the matter, he held that the deduction claimed by the assessee under s. 16(1) should be a....

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....nses which the assessee may have to incur, it was upto the assessee to incur or not to incur any expenses towards conveyance. Sri Swamy, on behalf of the assessee required us to take particular note of the fact that in this particular case there was no allocation of expenditure for conveyance and other expenses. Being so, in reality the assessee might not have spent any expenditure for the purpose of conveyance. In the absence of any enquiries conducted by the ITO in this regard, it was submitted that it would not be proper to come to the conclusion that the assessee was in receipt of conveyance allowance as contemplated under s.16(1) of the Act. in view of this, it was submitted that the order of the AAC in this regard should be upheld. ....

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....e expenses which he may have to incur. It may be that the assessee might not have to incur any expenditure on account of conveyance. From the facts of this case, as discussed above, we held that the AAC has correctly appreciated and described the allowance given to the assessee as a working 'allowance'. The working allowance so given to the assessee may be for various purposes, but it is not specifically for the purpose of meeting an expenditure on account of conveyance. The limitation for deduction under s. 16(1) of the Act is only in respect of these individuals who are in receipt of conveyance allowance. It is a case like this where the assessee is in receipt of daily allowance, in our view, it cannot be said that he was paid conveyance ....