Allowance paid to encourage academic , reseach and professional pursuits (Whether taxable or exempt u/s 10(14)) in cirucumstances if it not spended please advice me

[girish kulkarni]

Information given in details 

http://www.financialexpress.com/printer/news/71629/

 

2) Section 10 (14) / Rule 2BB (1): Under this section, the special allowances and benefits are fully exempted from income tax. This describes that ‘any allowance (by whatever name called) granted for encouraging the academic, research and other professional pursuits.’ Thus, the grant for encouraging research is by way of special benefits and it is not necessarily to meet expenses. That is why the word expenditure is particularly silent in this special allowance/benefits clause related to research pursuits otherwise no encouragement (copy enclosed, including Notification No. SO 267(E), dt. March 29, 1990). Therefore, please inform about the applicability of these sections, so that we can get full income tax exemption at source.

 

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Notification No. SO 267(E), dt. March 29, 1990

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http://law.incometaxindia.gov.in/DIT/Income-tax-acts.aspx

CHAPTER III

INCOMES WHICH DO NOT FORM PART OF TOTAL INCOME

Incomes not included in total income.

In computing the total income of a previous year of any person, any income falling within any of the following clauses shall not be included—

 

 

[(14)   (i) any such special allowance or benefit, not being in the nature of a perquisite within the meaning of clause (2) of section 17, specifically granted to meet expenses wholly, necessarily and exclusively incurred  in the performance of the duties of an office or employment of profit,[as may be prescribed], to the extent to which such expenses are actually incurred for that purpose ;

 

                      (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, 4[as may be prescribed and to the extent as may be prescribed] :]

 

                      5[Provided that nothing in sub-clause (ii) shall apply to any allowance in the nature of personal allowance granted to the assessee to remunerate or compensate him for performing duties of a special nature relating to his office or employment unless such allowance is related to the place of his posting or residence ;]

 

http://law.incometaxindia.gov.in/DIT/income-tax-rules.aspx

Rule 2DD

31[Prescribed allowances for the purposes of clause (14) of section 10.

 

2BB. (1) For the purposes of sub-clause (i) of clause (14) of section 10, prescribed allowances, by whatever name called, shall be the following, namely :—

 

        (a)  any allowance granted to meet the cost of travel on tour or on transfer;

 

        (b)  any allowance, whether, granted on tour or for the period of journey in connection with transfer, to meet the ordinary daily charges incurred by an employee on account of absence from his normal place of duty;

 

         (c)  any allowance granted to meet the expenditure incurred on conveyance in performance of duties of an office or employment of profit :

 

              Provided that free conveyance is not provided by the employer;

 

        (d)  any allowance granted to meet the expenditure incurred on a helper where such helper is engaged for the performance of the duties of an office or employment of profit;

 

         (e)  any allowance granted for encouraging the academic, research and training pursuits in educational and research institutions;

 

         (f)  any allowance granted to meet the expenditure incurred on the purchase or maintenance of uniform for wear during the performance of the duties of an office or employment of profit.

 

Explanation : For the purpose of clause (a), “allowance granted to meet the cost of travel on transfer” includes any sum paid in connection with transfer, packing and transportation of personal effects on such transfer.