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TMI Blog1978 (8) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... vant for the assessment year 1972-73, he was posted at Kanpur. He received Rs. 531 by way of city compensatory allowance because he was posted at Kanpur. He claimed this amount to be exempt from income-tax. The ITO concerned, however, did not accept it. The assessee appealed. The AAC upheld the contention that this allowance was given to compensate against extra cost of living in big cities. It wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 of 1975, Parliament added an Explanation to cl. (14) of s. 10 of the Act. This Explanation was inserted retrospectively by using the words " shall be inserted, and shall be deemed always to have been inserted ". The Explanation says : Explanation.--For the removal of doubts, it is hereby declared that any allowance granted to the assessee to meet his personal expenses at the place where the du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce to the place of posting. It was granted to meet the personal expenses necessitated by the extra high cost of living at, inter alia, Kanpur. In view of the Explanation such an allowance cannot be treated as deductible under cl. (14) on the ground that it was granted to meet expenses wholly, necessarily and exclusively incurred in the performance of the duties. We, therefore, answer the questi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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