- (1.) HEARD learned counsel for the parties, the appeal was admitted in 17th July, 2001, to consider the following substantial question of law : 'Whether, in the facts and circumstances of the case, the learned Tribunal was justified in holding that the conveyance and additional conveyance allowance paid to the appellant who is an employee of LIC is not exempt under Section 10(14)(ii) of the IT Act, 1961 ?'
(2.) THE appellant is officer in Life Insurance Corpn. of India and posted at Sriganganagar. During the course of assessment, it was noticed that assessee has claimed exemption of conveyance and additional conveyance allowance under Section 10(14)(ii) of the IT Act, 1961. The relevant provision of Section 10(14)(ii) reads as under : 'Section 10(14)(ii) - -Any such allowance granted to the assessee either to meet his personal expenses at the place where the duties of his office or employment of profit are ordinarily performed by him or at the place where he ordinarily resides, or to compensate him for the increased cost of living as may be prescribed and to the extent as may be prescribed.' Under Clause (i) of Section 10(14)(ii) of the IT Act, the requirement of exemption is that the amount should be actually used wholly, necessarily and exclusively in the performance of the duties in employment. The AO asked for the evidence whether the expenses on conveyance are used wholly, exclusively and necessarily for the purpose of performing of the duties by the assessee, in the course of employment. The assessee has not submitted any such evidence before the assessing authority. In para No. 4, the AO has noticed as under : 'Since the assessee has neither filed any evidence of actual expenditure incurred nor any amended notification has been cited under Section 10(14)(ii) to be issued by Central Government, in this behalf, as such I am of the view that the additional conveyance allowance which is not a reimbursement of actual expenditure incurred, is clearly formed a part of salary under Section 17(1)(iv) of the Act and is liable to be taxed in the hands of the assessee.'
(3.) IN appeal before the CIT(A), the CIT(A) has remanded the matter to the AO to examine whether the amount has been used actually for performance of the duty. In appeal before the Tribunal no such evidence of actual .use has been submitted. The Tribunal has gone by the actual use and has taken the views that under Sub -section (14) of Section 10, no such allowance be permitted for deduction unless that has been actually used by assessee. The assessee has not produced evidence even before the Tribunal that the amount has been reimbursed only because of actual use of that amount for performance of duty during the course of employment. The Tribunal has rightly disallowed the deduction claimed for. We find no infirmity in the impugned order. Therefore, the appeal stands dismissed.;