Section.16(1) - Standard deduction admissibility to pensioner - Reference applications not to be filed unless tax effect is beyond specified limit.

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....ct, 1974 substituted separate deductions in clauses (1), (iii) to (v) of section 16 by a standard deduction "in respect of expenditure incidental to employment" to be allowed in the computation of taxable salary. The Board's Circular No.138 of 1974 dated 7-6-1974 (explanatory Notes on Finance Act, 1974) clarified that in the case of a pensioner since no salary can be said to be derived from employ....

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....e Bench of the Tribunal at Bombay in the case of N.K. Pandya [ITA No. 2510(Bom)78-79 dated 14-2-1979] has supported the Department's case and has referred the matter to the High Court at the instance of the assessee. 3. The Board have considered the matter with a view to check the proliferation of litigation. It is found that the cost of litigation involved in each case is disproportionately hi....