1988 (3) TMI 11 - HC - Income Tax

Summary

The High Court of Calcutta ruled that city compensatory allowance received by bank officers/staff is not taxable under the Income-tax Act, 1961. The judgment in the case of CIT v. R. R. Bajoria supports this decision. The bank is prohibited from deducting tax on this allowance, and any tax already deducted must be refunded to the officers/staff within four weeks. If the Supreme Court overturns this decision, the Income-tax Department can recover the refunded tax.