TaxTMI 
TaxTMI 
2013 (9) TMI 683
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....s issued to deduct the Tax at Source (in short TDS) on conveyance/additional conveyance allowance to be paid to the Field Officers. Sri Prashant Chandra, Senior Counsel, assisted by Sri Shishir Jain, learned counsel for the petitioners submits that the development officers are the members of the petitioners' association. Being aggrieved by the action of their employer's for deducting the tax at source (TDS) pertaining to the conveyance allowance which is being paid in lieu of actual expenditure incurred in procuring business for the LIC preferred the instant writ petition interalia on the grounds that the said additional conveyance allowance does not come within the meaning of Section 10(14)(i) of the Income Tax Act, under which the impugn....
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.... Assessing Officer. Learned counsel relied on the ratio laid down in the case of Topman Exports Vs. CIT, 2012 (3) SCC 593, where it was observed that:- "39. It is a well-settled principle of statutory interpretation of a taxing statute that a subject will be liable to tax and will be entitled to exemption from tax according to the strict language of the taxing statute and if as per the words used in Explanation (baa) to Section 80-HHC read with the words used in clauses (iii-d) and (iii-e) of Section 28, the assessee was entitled to a deduction under Section 80-HHC on export profits, the benefit of such deduction cannot be denied to the assessee." Learned counsel in support of his arguments, also relied on the ratio laid down in the foll....
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.... as to activate existing agents and to motivate new agents and to render certain services to policy holders. The Officer is also required to perform such duties that are entrusted and assigned to him from time to time." Finally, in the said case, the Hon'ble Rajasthan High Court has directed the department not to insist upon the LIC to deduct the income tax at source in respect of conveyance and additional conveyance allowance, paid by it to development officers. The Assessing Officer was directed to pass the fresh order in accordance with law laid down in that case. Lastly, learned counsel submits that similar direction may kindly be issued to the LIC, not to deduct the tax at source as the conveyance/additional conveyance allowance is n....
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....ner of Income Tax Vs. M.D. Patil, [1998] 229 ITR 71, where it was observed that "incentive bonus" being linked to the quantum of business procured by the Development Officer amounts to salary which is taxable as such, and the same does not amount to allowance. It was observed by the Hon'ble Karnataka High Court that:- "Therefore, in our considered opinion, incentive bonus/ commission, is a production/business-oriented payment/income and it is not an allowance granted to meet any expense incurred by the Development Officer in the performance of his duties in that capacity. This inference of ours stands substantiated by the other provisions of the Third Schedule to the Regulations which apart from incentive commission ensures payments or rei....
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....e 2BB (10), transport allowance granting to an employee to meet the expenditure for the purpose of commuting between the place of his residence and the place of his duty, is prescribed @ Rs.800 per month. The Rule 3 of the Income Tax Rules prescribed the value of the perquisite. Table II of Rule 3 prescribed the value of the perquisite pertaining to the motor car owned or hired and used by the employee for personal/official or wholly official purpose. It is prescribed that the value of the perquisite shall be the amount calculated in respect of only one car. Further, it is prescribed that the employer has to maintain detail of the journey undertaking for the official purpose which may include the date of journey, destination, mileage and am....
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....of the facts and circumstances of the case, it appears that in the instant case, the employer has issued the certificate pertaining to the conveyance allowance/additional conveyance allowance used exclusively and wholly for the official purpose i.e. the procurement of business. The said certificate is issued by the employer after verifying the data. When it is so, then there is no reason for the Assessing Officer to reject the said certificate specially when the LIC is a statutory body and no private interest is involved. The LIC is not competent to determine the allowances which are exempted from the tax. This task will have to be performed by the Assessing Officer. Thus, in view of the provisions of Income Tax Act, 1961 and its interpret....