IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE K.SURENDRA MOHAN FRIDAY, THE 13TH FEBRUARY 2009 / 24TH MAGHA 1930 ITA.No. 82 of 2008() -------------------- AGAINST THE ORDER DATED 25/02/2004 IN ITA.30&31/COCH/2004 OF I.T.A.TRIBUNAL,COCHIN BENCH .................... APPELLANT/APPELLANT --------------------------------------- THE COMMISSIONER OF INCOME TAX, THIRUVANANTHAPURAM. BY ADV. SRI.P.K.R.MENON,SR.COUNSEL,GOI(TAXES) SRI.JOSE JOSEPH, SC FOR IT RESPONDENT(S): RESPONDENT ------------------------- SHRI.N.SHAJILAL, DEVELOPMENT OFFICER, LIC OF INDIA, ATTINGAL, THIRUVANANTHAPURAM. THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ALONG WITH ITA 165/2008 & CONN. CASES ON 13/02/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.N.RAMACHANDRAN NAIR & K.SURENDRA MOHAN, JJ. .................................................................... I.T. Appeal Nos.82,119,161,165 & 166 of 2008 .................................................................... Dated this the 13th day of February, 2009. JUDGMENT Ramachandran Nair, J. The question raised in all these appeals filed by the Revenue is whether the additional conveyance allowance granted by the LIC to Development Officers is exempt from tax under Section 10(14) of the Income Tax Act as held by the lower authorities. We have heard Standing Counsel appearing for the department and have perused the orders of the Tribunal and that of the first appellate authority. 2. This court had occasion to consider the issue in the context of challenge against deduction of tax on additional conveyance allowance in the decision in FRANCO JOHN & OTHERES V. UNION OF INDIA & OTHERS reported in (2004) 269 ITR 441, wherein it was held that reimbursement of actual expenditure incurred by employees towards conveyance expenditure is allowable deduction, whether it be granted as allowance or not. In all these cases, on facts we find that atleast the first appellate authority found that the employer namely, LIC 2 which is a statutory Corporation under the Government of India is reimbursing only actual expenditure incurred by Development Officers for travel to promote business of the LIC. So much so, on facts, respondent was found eligible for the exemption. We, therefore, dismiss these appeals but leaving freedom to the department to establish and disallow exemption in cases where the employee does not prove that the additional conveyance allowance received is not reimbursement of actual expenditure and is not a perquisite which is outside the scope of Section 10(14) of the Act. C.N.RAMACHANDRAN NAIR Judge K.SURENDRA MOHAN Judge pms