Semantic Analysis by spaCy
Commissioner of Income Tax Vs. Branch Manager, Lic of India
Decided On : Apr-21-2006
Court : Punjab and Haryana
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Branch Manager, Lic of India Semantic Analysis', 'shops' => array( 'LAW' => array( (int) 0 => 'Section 201(1', (int) 1 => 'the IT Act', (int) 2 => 'Section 10(14', (int) 3 => 'the IT Act', (int) 4 => 'the Development Officers', (int) 5 => 'Section 10(14', (int) 6 => 'Rule 2BB', (int) 7 => 'Section 260A of the Act' ), 'CARDINAL' => array( (int) 0 => '1', (int) 1 => '543', (int) 2 => 'two', (int) 3 => '1997.4', (int) 4 => '192', (int) 5 => '201(1A', (int) 6 => 'two', (int) 7 => '218', (int) 8 => '209', (int) 9 => '216' ), 'ORG' => array( (int) 0 => 'Court', (int) 1 => 'ITA No', (int) 2 => 'the Hon'ble Tribunal', (int) 3 => 'the Reimbursement of Expenses Scheme', (int) 4 => 'ITO', (int) 5 => 'Incentive Bonus Scheme', (int) 6 => 'Reimbursement of Expenses Scheme', (int) 7 => 'the Incentive Bonus Scheme', (int) 8 => 'the Reimbursement of Expenses Scheme', (int) 9 => 'Reimbursement of Expenses Scheme', (int) 10 => 'AO', (int) 11 => 'LIC', (int) 12 => 'the Reimbursement of Expenses Scheme', (int) 13 => 'TDS', (int) 14 => 'ITO', (int) 15 => 'Bamala Branch', (int) 16 => 'LIC', (int) 17 => 'Tribunal', (int) 18 => 'Development Officer', (int) 19 => 'Reimbursement of Expenses Scheme', (int) 20 => 'TDS', (int) 21 => 'inter alia', (int) 22 => 'ITA Nos', (int) 23 => 'Rajasthan High Court', (int) 24 => 'Life Insurance Corporation of', (int) 25 => 'Union of India', (int) 26 => 'Corporation', (int) 27 => 'Corporation', (int) 28 => 'LIC', (int) 29 => 'Corporation', (int) 30 => 'LIC', (int) 31 => 'LIC', (int) 32 => 'LIC', (int) 33 => 'LIC', (int) 34 => 'the Development Officers', (int) 35 => 'CBDT', (int) 36 => 'LIC', (int) 37 => 'LIC', (int) 38 => 'Tribunal', (int) 39 => 'the Tribunal on the same', (int) 40 => 'LIC', (int) 41 => 'Rajasthan High Court', (int) 42 => 'LIC', (int) 43 => 'Tribunal' ), 'DATE' => array( (int) 0 => '15th July, 2005', (int) 1 => '2000-01', (int) 2 => '1997', (int) 3 => 'the year 1997', (int) 4 => '1997', (int) 5 => '1997', (int) 6 => '4,44,570', (int) 7 => '1997', (int) 8 => 'the year 1999-2000', (int) 9 => '1997', (int) 10 => '30th April, 2004', (int) 11 => 'the financial year', (int) 12 => '1961', (int) 13 => '3rd Aug., 1987' ), 'GPE' => array( (int) 0 => 'India', (int) 1 => 'India', (int) 2 => 'India', (int) 3 => 'India', (int) 4 => 'India', (int) 5 => 'S.S.S.' ), 'PERSON' => array( (int) 0 => 'N.L. Sharda', (int) 1 => 'servicing.(vi', (int) 2 => 'Shri' ), 'ORDINAL' => array( (int) 0 => 'first' ) ), 'desc' => array( 'Judgement' => array( 'id' => '622869', 'acts' => '<a href="/act/51330/income-tax-act-1961-complete-act">Income Tax Act, 1961</a> - Sections 10(14), 192, 201(1), 201(1A) and 260A', 'appealno' => 'IT Appeal No. 645 of 2005', 'appellant' => 'Commissioner of Income Tax', 'authreffered' => '', 'casename' => 'Commissioner of Income Tax Vs. Branch Manager, Lic of India', 'casenote' => ' - Sections 80 (2) & 89 & Punjab Motor Vehicles Rules, 1989, Rules 85 & 80: [T.S. Thakur, CJ, Jasbir Singh & Surya Kant, JJ] Appeal against orders of State or Regional Transport authority imitation Held, A stipulation regarding the period of limitation available for invoking the remedy shall have to be strictly construed. That is because any provision by way of limitation is in the nature of a restraint on the remedy provided under the Act. So viewed two inferences are clear viz., (1) Sections 80 and 89 of the Act read with Rule 85 of the Rules make it obligatory for the authorities making the order to communicate it to the applicant concerned and (2) the period of limitation for any appeal against the order is reckonable from the date of such communication of the reasons would imply communication of a copy of the written order itself, a party who knows about the making of an order cannot ignore the same and allow grass to grow under its feet and do nothing except waiting for a formal communication of the order or to choose a tenuous plea that even though he knew about the order, he was waiting for its formal communication to seek redress against the same in appeal. If a party does not know about the making of the order either actually or constructively it may claim that the period of limitation would start running from the date it acquires knowledge of the making of an order but one cannot understand how a party, who has acquired knowledge of the making an order either directly or constructively can ignore the same and belatedly seek redress just because the authority making the order had made a default in formally communicating the order to him. Allowing a party to do so would amount to placing a premium on the lack of diligence of a party, who is remiss in seeking a remedy that was available to it. Therefore, knowledge whether actual or construction of the order passed by the State or Regional Transport Authority should result in commencement of the period of limitation. Thus,. In cases where the State or Regional Transport Authority has not communicated the order of refusal passed to the persons concerned, the period of limitation for filing an appeal would commence from the date when the parties concerned acquire knowledge of passing of the said order. - (v) To render all such services to policyholders conducive to better policy servicing.', 'caseanalysis' => null, 'casesref' => 'Life Insurance Corporation of India v. Union of India;', 'citingcases' => '', 'counselplain' => ' N.L. Sharda, Adv.', 'counseldef' => '', 'court' => 'Punjab and Haryana', 'court_type' => 'HC', 'decidedon' => '2006-04-21', 'deposition' => 'Appeal dismissed', 'favorof' => null, 'findings' => null, 'judge' => ' Adarsh Kumar Goel and; Rajesh Bindal, JJ.', 'judgement' => '<p style="text-align: justify;">1. The Revenue has approached this Court by filing the present appeal raising the following substantial question of law arising out of the order dt. 15th July, 2005 passed in ITA No. 543/Chd/2003 for the asst. yr. 2000-01:</p><p style="text-align: justify;">Whether, on the facts and in the circumstances of the case, the Hon'ble Tribunal has erred in holding that the payment made to its Development Officer by the LIC of India under the Reimbursement of Expenses Scheme, 1997 is not the income of the assessee and further it is not a part of salary of the recipient Development Officer ignoring the factual position that details of expenses incurred have not been reported to the branch manager (paying officer) on the basis of which it could be inferred that these allowances were the reimbursement of actual expenses?</p><p style="text-align: justify;">2. The ITO rejected the contention of the assessee to the effect that in the year 1997 LIC of India framed two separate schemes, namely, Incentive Bonus Scheme, 1997 and Reimbursement of Expenses Scheme, 1997. The amounts paid to the Development. Officer under the Incentive Bonus Scheme, was taxable and the income-tax was being deducted thereon as per the rules whereas the expenses reimbursed under the Reimbursement of Expenses Scheme, since were not taxable, the same was not being treated as part of salary of the Development Officer and, hence, no deduction was being made thereon.</p><p style="text-align: justify;">3. We have heard Dr. N.L. Sharda, advocate, counsel for the Revenue. A perusal of the substantial question of law sought to be raised shows that the same is not happily worded. However, still we thought it appropriate to go into the substance of the matter. The Revenue, in the present appeal, is seeking to dispute the taxability of expenses reimbursed to the Development Officer of the LIC of India under Reimbursement of Expenses Scheme, 1997.</p><p style="text-align: justify;">4. In proceedings initiated under Section 201(1) of the IT Act (for short 'the Act') r/w Sections 192 and 201(1A) of the Act, the Revenue treated the assessee in default for not deducting the tax on a sum of Rs. 4,44,570 at source. Assessee was further held liable to pay mandatory interest. The primary reason given by the AO was that the expenses reimbursed by the LIC to its Development Officers under the Reimbursement of Expenses Scheme, 1997 were actually to be treated as a part of the salary of the Development Officer, hence, TDS was required to be deducted thereon.</p><p style="text-align: justify;">The assessee went in appeal before the CIT(A) against the order of ITO which was accepted on the ground that the earlier appeal of Bamala Branch filed by LIC of India for the year 1999-2000 had been accepted on the same issue.</p><p style="text-align: justify;">The Revenue went in appeal before the Tribunal against the order passed by the CIT(A) and reiterated its stand that the payments made to Development Officer under Reimbursement of Expenses Scheme, 1997, are to be treated as part of the salary of the Development Officer, hence, TDS was required to be deducted thereon. On the other hand, the assessee, inter alia, referred two earlier orders in ITA Nos. 218, 209 and 216/Chd/2002 dt. 30th April, 2004 of the Tribunal in the case of the assessee wherein the issue was decided against the Revenue and in favour of the assessee, which orders were not appealed against.</p><p style="text-align: justify;">Besides this, the assessee also referred to a judgment of Rajasthan High Court in Life Insurance Corporation of India v. Union of India wherein it is held as under:</p><p style="text-align: justify;">The LIC of India is a statutory body. The duties of a Development Officer are provided under the relevant rules, which are extracted as follows:</p><p style="text-align: justify;">Duties of Development Officers and obligations.-A (i) To develop and increase the production of the life insurance business in a planned way as far as may be practicable in the area that may be allotted to work from time to time through the agents placed under his supervision by the Corporation and in consonance with the corporate objectives of the Corporation.</p><p style="text-align: justify;">(ii) To guide, to supervise and direct the activities of the agents placed under his supervision by the Corporation.</p><p style="text-align: justify;">(iii) To introduce suitable persons to the Corporation for appointment as new agents.</p><p style="text-align: justify;">(iv) To act generally in such a way as to activise existing agents and motivate new agents so as to develop a stable agency force.</p><p style="text-align: justify;">(v) To render all such services to policyholders conducive to better policy servicing.</p><p style="text-align: justify;">(vi) To carry out the investigation of claims, revival of lapsed policies and liaison work in connection with S.S.S. business.</p><p style="text-align: justify;">(vii) To perform such other duties as may be entrusted to him.</p><p style="text-align: justify;">It is, thus, clear that the Development Officers of the LIC are full-time employees of the corporation whose main task is to develop the business in life insurance. They are required to discharge the duties and obligations which, inter aha, include development of life insurance business of the Corporation. The very first duty enumerated for the Development Officer is to develop and increase the production of new insurance business in the planned way, as far as practicable in the area that may be allotted to him from time to time. The other duties and obligations include the duty to supervise and to guide the activities of the agents placed under the supervision of the Development Officers; to recruit new agents so as to develop agency force; and to act generally in such a way as to activate existing agents and to motivate new agents and to render certain services to policyholders. The officer is also required to perform such duties that are entrusted and assigned to him from time to time.</p><p style="text-align: justify;">As per the practice, the LIC has been giving the utilisation certificate for the purpose of income-tax as follows:</p><p style="text-align: justify;">This is to certify that during the financial year... (assessment year....), Shri. ..., has been paid Rs. ...to meet the expenses wholly, necessarily and exclusively incurred in performance of development duty and that the said amount has actually been incurred wholly for that purpose. As such this amount is exempt from income-tax under Section 10(14) of the IT Act, 1961, and, therefore, no tax has been deducted at source thereon.</p><p style="text-align: justify;">(Branch Manager).</p><p style="text-align: justify;">It is, thus, evident that the conveyance allowance and the additional conveyance allowance are paid to the Development Officers for meeting actual expenditure incurred by them in discharge of their field duties and, thus, wholly, necessarily and exclusively for meeting such expenditure, the allowance is being exempt as per the norms set out in the LIC Circular dt. 3rd Aug., 1987, referred to in the preceding para. It appears that the LIC has worked out the additional conveyance allowance to the Development Officers considering the probable expenditure for procuring the business. The LIC appears to have devised the general formula having a reference to the parameters of the business and, thus, the payment of additional conveyance allowance is a reimbursement for actual expenditure incurred by the Development Officers on account of conveyance in relation to performance of their duties and the said expenditure has a direct nexus with the performance of duties for development of the insurance business by way of meeting several people and to enroll new life insurance agents and to meet the insurance persons for encouraging them to take insurance policies. Naturally, in such circumstances, touring expenses are incurred on conveyance. Such conveyance expenses are reimbursed by the employer as per the prescribed norms in the name of additional conveyance allowance. The certificate is given by the LIC-employer of the minimum amount which the LIC certifies that it is the amount actually spent by the Development Officers in the performance of their duties. The ultimate liability of claiming exemption and proving the same is on the employee-assessee (Development Officers). The exemption limit is restricted by the instructions issued by the CBDT from time to time. Therefore, we hold that the Development Officers in the LIC are entitled to claim exemption under Section 10(14) of the Act in respect of conveyance allowance/additional conveyance allowance upon satisfying the conditions that such allowances have actually been spent for the purpose for which they were given wholly, necessarily and exclusively in the performance of duties. Therefore, the LIC cannot be insisted for deduction of tax to be deducted at source to the extent such conveyance allowance/additional conveyance allowance is exempt under Rule 2BB and further such minimum limit is set from time to time. The ultimate liability of claiming exemption and proving the same is on the employee-assessee, i.e. the Development Officers.</p><p style="text-align: justify;">5. The Tribunal after detailed discussion on the contentions of the parties and also keeping in view the fact that the Revenue had not challenged the earlier orders passed by the Tribunal on the same issue, pertaining to different offices of LIC, upheld the order passed by the CFT(A) and dismissed the appeal of the Revenue.</p><p style="text-align: justify;">6. For the reasons given above and respectfully concurring with the view taken by Rajasthan High Court in LIC's case (supra), we do not find any reason to differ from the view taken by the Tribunal and hold that no substantial question of law arises in the present case.</p><p style="text-align: justify;">7. Faced with this the counsel for the Revenue raised the plea that the expenses claimed by the assessee were not admissible to the extent that they had been claimed. We are afraid this plea of the assessee (sic-Revenue) does not fit in the domain of a substantial question of law, if examined on the guiding principles laid down for entertaining of appeals under Section 260A of the Act.</p><p style="text-align: justify;">In view of our above discussions the appeal is dismissed in limine.<p style="text-align: justify;"></p><p style="text-align: justify;">', 'observations' => null, 'overruledby' => null, 'prhistory' => '', 'pubs' => '(2006)203CTR(P& H)603; [2008]298ITR358(P& H)', 'ratiodecidendi' => '', 'respondent' => 'Branch Manager, Lic of India', 'sub' => 'Direct Taxation', 'link' => null, 'circuit' => null ) ), 'args' => array( (int) 0 => '622869' ) ) $title_for_layout = 'Commissioner of Income Tax Vs. Branch Manager, Lic of India Semantic Analysis' $shops = array( 'LAW' => array( (int) 0 => 'Section 201(1', (int) 1 => 'the IT Act', (int) 2 => 'Section 10(14', (int) 3 => 'the IT Act', (int) 4 => 'the Development Officers', (int) 5 => 'Section 10(14', (int) 6 => 'Rule 2BB', (int) 7 => 'Section 260A of the Act' ), 'CARDINAL' => array( (int) 0 => '1', (int) 1 => '543', (int) 2 => 'two', (int) 3 => '1997.4', (int) 4 => '192', (int) 5 => '201(1A', (int) 6 => 'two', (int) 7 => '218', (int) 8 => '209', (int) 9 => '216' ), 'ORG' => array( (int) 0 => 'Court', (int) 1 => 'ITA No', (int) 2 => 'the Hon'ble Tribunal', (int) 3 => 'the Reimbursement of Expenses Scheme', (int) 4 => 'ITO', (int) 5 => 'Incentive Bonus Scheme', (int) 6 => 'Reimbursement of Expenses Scheme', (int) 7 => 'the Incentive Bonus Scheme', (int) 8 => 'the Reimbursement of Expenses Scheme', (int) 9 => 'Reimbursement of Expenses Scheme', (int) 10 => 'AO', (int) 11 => 'LIC', (int) 12 => 'the Reimbursement of Expenses Scheme', (int) 13 => 'TDS', (int) 14 => 'ITO', (int) 15 => 'Bamala Branch', (int) 16 => 'LIC', (int) 17 => 'Tribunal', (int) 18 => 'Development Officer', (int) 19 => 'Reimbursement of Expenses Scheme', (int) 20 => 'TDS', (int) 21 => 'inter alia', (int) 22 => 'ITA Nos', (int) 23 => 'Rajasthan High Court', (int) 24 => 'Life Insurance Corporation of', (int) 25 => 'Union of India', (int) 26 => 'Corporation', (int) 27 => 'Corporation', (int) 28 => 'LIC', (int) 29 => 'Corporation', (int) 30 => 'LIC', (int) 31 => 'LIC', (int) 32 => 'LIC', (int) 33 => 'LIC', (int) 34 => 'the Development Officers', (int) 35 => 'CBDT', (int) 36 => 'LIC', (int) 37 => 'LIC', (int) 38 => 'Tribunal', (int) 39 => 'the Tribunal on the same', (int) 40 => 'LIC', (int) 41 => 'Rajasthan High Court', (int) 42 => 'LIC', (int) 43 => 'Tribunal' ), 'DATE' => array( (int) 0 => '15th July, 2005', (int) 1 => '2000-01', (int) 2 => '1997', (int) 3 => 'the year 1997', (int) 4 => '1997', (int) 5 => '1997', (int) 6 => '4,44,570', (int) 7 => '1997', (int) 8 => 'the year 1999-2000', (int) 9 => '1997', (int) 10 => '30th April, 2004', (int) 11 => 'the financial year', (int) 12 => '1961', (int) 13 => '3rd Aug., 1987' ), 'GPE' => array( (int) 0 => 'India', (int) 1 => 'India', (int) 2 => 'India', (int) 3 => 'India', (int) 4 => 'India', (int) 5 => 'S.S.S.' ), 'PERSON' => array( (int) 0 => 'N.L. Sharda', (int) 1 => 'servicing.(vi', (int) 2 => 'Shri' ), 'ORDINAL' => array( (int) 0 => 'first' ) ) $desc = array( 'Judgement' => array( 'id' => '622869', 'acts' => '<a href="/act/51330/income-tax-act-1961-complete-act">Income Tax Act, 1961</a> - Sections 10(14), 192, 201(1), 201(1A) and 260A', 'appealno' => 'IT Appeal No. 645 of 2005', 'appellant' => 'Commissioner of Income Tax', 'authreffered' => '', 'casename' => 'Commissioner of Income Tax Vs. Branch Manager, Lic of India', 'casenote' => ' - Sections 80 (2) & 89 & Punjab Motor Vehicles Rules, 1989, Rules 85 & 80: [T.S. Thakur, CJ, Jasbir Singh & Surya Kant, JJ] Appeal against orders of State or Regional Transport authority imitation Held, A stipulation regarding the period of limitation available for invoking the remedy shall have to be strictly construed. That is because any provision by way of limitation is in the nature of a restraint on the remedy provided under the Act. So viewed two inferences are clear viz., (1) Sections 80 and 89 of the Act read with Rule 85 of the Rules make it obligatory for the authorities making the order to communicate it to the applicant concerned and (2) the period of limitation for any appeal against the order is reckonable from the date of such communication of the reasons would imply communication of a copy of the written order itself, a party who knows about the making of an order cannot ignore the same and allow grass to grow under its feet and do nothing except waiting for a formal communication of the order or to choose a tenuous plea that even though he knew about the order, he was waiting for its formal communication to seek redress against the same in appeal. If a party does not know about the making of the order either actually or constructively it may claim that the period of limitation would start running from the date it acquires knowledge of the making of an order but one cannot understand how a party, who has acquired knowledge of the making an order either directly or constructively can ignore the same and belatedly seek redress just because the authority making the order had made a default in formally communicating the order to him. Allowing a party to do so would amount to placing a premium on the lack of diligence of a party, who is remiss in seeking a remedy that was available to it. Therefore, knowledge whether actual or construction of the order passed by the State or Regional Transport Authority should result in commencement of the period of limitation. Thus,. In cases where the State or Regional Transport Authority has not communicated the order of refusal passed to the persons concerned, the period of limitation for filing an appeal would commence from the date when the parties concerned acquire knowledge of passing of the said order. - (v) To render all such services to policyholders conducive to better policy servicing.', 'caseanalysis' => null, 'casesref' => 'Life Insurance Corporation of India v. Union of India;', 'citingcases' => '', 'counselplain' => ' N.L. Sharda, Adv.', 'counseldef' => '', 'court' => 'Punjab and Haryana', 'court_type' => 'HC', 'decidedon' => '2006-04-21', 'deposition' => 'Appeal dismissed', 'favorof' => null, 'findings' => null, 'judge' => ' Adarsh Kumar Goel and; Rajesh Bindal, JJ.', 'judgement' => '<p style="text-align: justify;">1. The Revenue has approached this Court by filing the present appeal raising the following substantial question of law arising out of the order dt. 15th July, 2005 passed in ITA No. 543/Chd/2003 for the asst. yr. 2000-01:</p><p style="text-align: justify;">Whether, on the facts and in the circumstances of the case, the Hon'ble Tribunal has erred in holding that the payment made to its Development Officer by the LIC of India under the Reimbursement of Expenses Scheme, 1997 is not the income of the assessee and further it is not a part of salary of the recipient Development Officer ignoring the factual position that details of expenses incurred have not been reported to the branch manager (paying officer) on the basis of which it could be inferred that these allowances were the reimbursement of actual expenses?</p><p style="text-align: justify;">2. The ITO rejected the contention of the assessee to the effect that in the year 1997 LIC of India framed two separate schemes, namely, Incentive Bonus Scheme, 1997 and Reimbursement of Expenses Scheme, 1997. The amounts paid to the Development. Officer under the Incentive Bonus Scheme, was taxable and the income-tax was being deducted thereon as per the rules whereas the expenses reimbursed under the Reimbursement of Expenses Scheme, since were not taxable, the same was not being treated as part of salary of the Development Officer and, hence, no deduction was being made thereon.</p><p style="text-align: justify;">3. We have heard Dr. N.L. Sharda, advocate, counsel for the Revenue. A perusal of the substantial question of law sought to be raised shows that the same is not happily worded. However, still we thought it appropriate to go into the substance of the matter. The Revenue, in the present appeal, is seeking to dispute the taxability of expenses reimbursed to the Development Officer of the LIC of India under Reimbursement of Expenses Scheme, 1997.</p><p style="text-align: justify;">4. In proceedings initiated under Section 201(1) of the IT Act (for short 'the Act') r/w Sections 192 and 201(1A) of the Act, the Revenue treated the assessee in default for not deducting the tax on a sum of Rs. 4,44,570 at source. Assessee was further held liable to pay mandatory interest. The primary reason given by the AO was that the expenses reimbursed by the LIC to its Development Officers under the Reimbursement of Expenses Scheme, 1997 were actually to be treated as a part of the salary of the Development Officer, hence, TDS was required to be deducted thereon.</p><p style="text-align: justify;">The assessee went in appeal before the CIT(A) against the order of ITO which was accepted on the ground that the earlier appeal of Bamala Branch filed by LIC of India for the year 1999-2000 had been accepted on the same issue.</p><p style="text-align: justify;">The Revenue went in appeal before the Tribunal against the order passed by the CIT(A) and reiterated its stand that the payments made to Development Officer under Reimbursement of Expenses Scheme, 1997, are to be treated as part of the salary of the Development Officer, hence, TDS was required to be deducted thereon. On the other hand, the assessee, inter alia, referred two earlier orders in ITA Nos. 218, 209 and 216/Chd/2002 dt. 30th April, 2004 of the Tribunal in the case of the assessee wherein the issue was decided against the Revenue and in favour of the assessee, which orders were not appealed against.</p><p style="text-align: justify;">Besides this, the assessee also referred to a judgment of Rajasthan High Court in Life Insurance Corporation of India v. Union of India wherein it is held as under:</p><p style="text-align: justify;">The LIC of India is a statutory body. The duties of a Development Officer are provided under the relevant rules, which are extracted as follows:</p><p style="text-align: justify;">Duties of Development Officers and obligations.-A (i) To develop and increase the production of the life insurance business in a planned way as far as may be practicable in the area that may be allotted to work from time to time through the agents placed under his supervision by the Corporation and in consonance with the corporate objectives of the Corporation.</p><p style="text-align: justify;">(ii) To guide, to supervise and direct the activities of the agents placed under his supervision by the Corporation.</p><p style="text-align: justify;">(iii) To introduce suitable persons to the Corporation for appointment as new agents.</p><p style="text-align: justify;">(iv) To act generally in such a way as to activise existing agents and motivate new agents so as to develop a stable agency force.</p><p style="text-align: justify;">(v) To render all such services to policyholders conducive to better policy servicing.</p><p style="text-align: justify;">(vi) To carry out the investigation of claims, revival of lapsed policies and liaison work in connection with S.S.S. business.</p><p style="text-align: justify;">(vii) To perform such other duties as may be entrusted to him.</p><p style="text-align: justify;">It is, thus, clear that the Development Officers of the LIC are full-time employees of the corporation whose main task is to develop the business in life insurance. They are required to discharge the duties and obligations which, inter aha, include development of life insurance business of the Corporation. The very first duty enumerated for the Development Officer is to develop and increase the production of new insurance business in the planned way, as far as practicable in the area that may be allotted to him from time to time. The other duties and obligations include the duty to supervise and to guide the activities of the agents placed under the supervision of the Development Officers; to recruit new agents so as to develop agency force; and to act generally in such a way as to activate existing agents and to motivate new agents and to render certain services to policyholders. The officer is also required to perform such duties that are entrusted and assigned to him from time to time.</p><p style="text-align: justify;">As per the practice, the LIC has been giving the utilisation certificate for the purpose of income-tax as follows:</p><p style="text-align: justify;">This is to certify that during the financial year... (assessment year....), Shri. ..., has been paid Rs. ...to meet the expenses wholly, necessarily and exclusively incurred in performance of development duty and that the said amount has actually been incurred wholly for that purpose. As such this amount is exempt from income-tax under Section 10(14) of the IT Act, 1961, and, therefore, no tax has been deducted at source thereon.</p><p style="text-align: justify;">(Branch Manager).</p><p style="text-align: justify;">It is, thus, evident that the conveyance allowance and the additional conveyance allowance are paid to the Development Officers for meeting actual expenditure incurred by them in discharge of their field duties and, thus, wholly, necessarily and exclusively for meeting such expenditure, the allowance is being exempt as per the norms set out in the LIC Circular dt. 3rd Aug., 1987, referred to in the preceding para. It appears that the LIC has worked out the additional conveyance allowance to the Development Officers considering the probable expenditure for procuring the business. The LIC appears to have devised the general formula having a reference to the parameters of the business and, thus, the payment of additional conveyance allowance is a reimbursement for actual expenditure incurred by the Development Officers on account of conveyance in relation to performance of their duties and the said expenditure has a direct nexus with the performance of duties for development of the insurance business by way of meeting several people and to enroll new life insurance agents and to meet the insurance persons for encouraging them to take insurance policies. Naturally, in such circumstances, touring expenses are incurred on conveyance. Such conveyance expenses are reimbursed by the employer as per the prescribed norms in the name of additional conveyance allowance. The certificate is given by the LIC-employer of the minimum amount which the LIC certifies that it is the amount actually spent by the Development Officers in the performance of their duties. The ultimate liability of claiming exemption and proving the same is on the employee-assessee (Development Officers). The exemption limit is restricted by the instructions issued by the CBDT from time to time. Therefore, we hold that the Development Officers in the LIC are entitled to claim exemption under Section 10(14) of the Act in respect of conveyance allowance/additional conveyance allowance upon satisfying the conditions that such allowances have actually been spent for the purpose for which they were given wholly, necessarily and exclusively in the performance of duties. Therefore, the LIC cannot be insisted for deduction of tax to be deducted at source to the extent such conveyance allowance/additional conveyance allowance is exempt under Rule 2BB and further such minimum limit is set from time to time. The ultimate liability of claiming exemption and proving the same is on the employee-assessee, i.e. the Development Officers.</p><p style="text-align: justify;">5. The Tribunal after detailed discussion on the contentions of the parties and also keeping in view the fact that the Revenue had not challenged the earlier orders passed by the Tribunal on the same issue, pertaining to different offices of LIC, upheld the order passed by the CFT(A) and dismissed the appeal of the Revenue.</p><p style="text-align: justify;">6. For the reasons given above and respectfully concurring with the view taken by Rajasthan High Court in LIC's case (supra), we do not find any reason to differ from the view taken by the Tribunal and hold that no substantial question of law arises in the present case.</p><p style="text-align: justify;">7. Faced with this the counsel for the Revenue raised the plea that the expenses claimed by the assessee were not admissible to the extent that they had been claimed. We are afraid this plea of the assessee (sic-Revenue) does not fit in the domain of a substantial question of law, if examined on the guiding principles laid down for entertaining of appeals under Section 260A of the Act.</p><p style="text-align: justify;">In view of our above discussions the appeal is dismissed in limine.<p style="text-align: justify;"></p><p style="text-align: justify;">', 'observations' => null, 'overruledby' => null, 'prhistory' => '', 'pubs' => '(2006)203CTR(P& H)603; [2008]298ITR358(P& H)', 'ratiodecidendi' => '', 'respondent' => 'Branch Manager, Lic of India', 'sub' => 'Direct Taxation', 'link' => null, 'circuit' => null ) ) $args = array( (int) 0 => '622869' ) $pattern = '/\(((0[1-9]|[12][0-9]|3[01])[.](0[1-9]|1[012])[.](17|18|19|20)[0-9]{2}).*\)/'include - APP/View/Case/meta.ctp, line 36 View::_evaluate() - CORE/Cake/View/View.php, line 971 View::_render() - CORE/Cake/View/View.php, line 933 View::render() - CORE/Cake/View/View.php, line 473 Controller::render() - CORE/Cake/Controller/Controller.php, line 963 Dispatcher::_invoke() - CORE/Cake/Routing/Dispatcher.php, line 200 Dispatcher::dispatch() - CORE/Cake/Routing/Dispatcher.php, line 167 [main] - APP/webroot/index.php, line 109
Warning (2): Invalid argument supplied for foreach() [APP/View/Case/meta.ctp, line 39]Code Context//$shops = $shops['entities'];foreach ($shops2 as $key => $val) {$viewFile = '/home/legalcrystal/app/View/Case/meta.ctp' $dataForView = array( 'title_for_layout' => 'Commissioner of Income Tax Vs. Branch Manager, Lic of India Semantic Analysis', 'shops' => array( 'LAW' => array( (int) 0 => 'Section 201(1', (int) 1 => 'the IT Act', (int) 2 => 'Section 10(14', (int) 3 => 'the IT Act', (int) 4 => 'the Development Officers', (int) 5 => 'Section 10(14', (int) 6 => 'Rule 2BB', (int) 7 => 'Section 260A of the Act' ), 'CARDINAL' => array( (int) 0 => '1', (int) 1 => '543', (int) 2 => 'two', (int) 3 => '1997.4', (int) 4 => '192', (int) 5 => '201(1A', (int) 6 => 'two', (int) 7 => '218', (int) 8 => '209', (int) 9 => '216' ), 'ORG' => array( (int) 0 => 'Court', (int) 1 => 'ITA No', (int) 2 => 'the Hon'ble Tribunal', (int) 3 => 'the Reimbursement of Expenses Scheme', (int) 4 => 'ITO', (int) 5 => 'Incentive Bonus Scheme', (int) 6 => 'Reimbursement of Expenses Scheme', (int) 7 => 'the Incentive Bonus Scheme', (int) 8 => 'the Reimbursement of Expenses Scheme', (int) 9 => 'Reimbursement of Expenses Scheme', (int) 10 => 'AO', (int) 11 => 'LIC', (int) 12 => 'the Reimbursement of Expenses Scheme', (int) 13 => 'TDS', (int) 14 => 'ITO', (int) 15 => 'Bamala Branch', (int) 16 => 'LIC', (int) 17 => 'Tribunal', (int) 18 => 'Development Officer', (int) 19 => 'Reimbursement of Expenses Scheme', (int) 20 => 'TDS', (int) 21 => 'inter alia', (int) 22 => 'ITA Nos', (int) 23 => 'Rajasthan High Court', (int) 24 => 'Life Insurance Corporation of', (int) 25 => 'Union of India', (int) 26 => 'Corporation', (int) 27 => 'Corporation', (int) 28 => 'LIC', (int) 29 => 'Corporation', (int) 30 => 'LIC', (int) 31 => 'LIC', (int) 32 => 'LIC', (int) 33 => 'LIC', (int) 34 => 'the Development Officers', (int) 35 => 'CBDT', (int) 36 => 'LIC', (int) 37 => 'LIC', (int) 38 => 'Tribunal', (int) 39 => 'the Tribunal on the same', (int) 40 => 'LIC', (int) 41 => 'Rajasthan High Court', (int) 42 => 'LIC', (int) 43 => 'Tribunal' ), 'DATE' => array( (int) 0 => '15th July, 2005', (int) 1 => '2000-01', (int) 2 => '1997', (int) 3 => 'the year 1997', (int) 4 => '1997', (int) 5 => '1997', (int) 6 => '4,44,570', (int) 7 => '1997', (int) 8 => 'the year 1999-2000', (int) 9 => '1997', (int) 10 => '30th April, 2004', (int) 11 => 'the financial year', (int) 12 => '1961', (int) 13 => '3rd Aug., 1987' ), 'GPE' => array( (int) 0 => 'India', (int) 1 => 'India', (int) 2 => 'India', (int) 3 => 'India', (int) 4 => 'India', (int) 5 => 'S.S.S.' ), 'PERSON' => array( (int) 0 => 'N.L. Sharda', (int) 1 => 'servicing.(vi', (int) 2 => 'Shri' ), 'ORDINAL' => array( (int) 0 => 'first' ) ), 'desc' => array( 'Judgement' => array( 'id' => '622869', 'acts' => '<a href="/act/51330/income-tax-act-1961-complete-act">Income Tax Act, 1961</a> - Sections 10(14), 192, 201(1), 201(1A) and 260A', 'appealno' => 'IT Appeal No. 645 of 2005', 'appellant' => 'Commissioner of Income Tax', 'authreffered' => '', 'casename' => 'Commissioner of Income Tax Vs. Branch Manager, Lic of India', 'casenote' => ' - Sections 80 (2) & 89 & Punjab Motor Vehicles Rules, 1989, Rules 85 & 80: [T.S. Thakur, CJ, Jasbir Singh & Surya Kant, JJ] Appeal against orders of State or Regional Transport authority imitation Held, A stipulation regarding the period of limitation available for invoking the remedy shall have to be strictly construed. That is because any provision by way of limitation is in the nature of a restraint on the remedy provided under the Act. So viewed two inferences are clear viz., (1) Sections 80 and 89 of the Act read with Rule 85 of the Rules make it obligatory for the authorities making the order to communicate it to the applicant concerned and (2) the period of limitation for any appeal against the order is reckonable from the date of such communication of the reasons would imply communication of a copy of the written order itself, a party who knows about the making of an order cannot ignore the same and allow grass to grow under its feet and do nothing except waiting for a formal communication of the order or to choose a tenuous plea that even though he knew about the order, he was waiting for its formal communication to seek redress against the same in appeal. If a party does not know about the making of the order either actually or constructively it may claim that the period of limitation would start running from the date it acquires knowledge of the making of an order but one cannot understand how a party, who has acquired knowledge of the making an order either directly or constructively can ignore the same and belatedly seek redress just because the authority making the order had made a default in formally communicating the order to him. Allowing a party to do so would amount to placing a premium on the lack of diligence of a party, who is remiss in seeking a remedy that was available to it. Therefore, knowledge whether actual or construction of the order passed by the State or Regional Transport Authority should result in commencement of the period of limitation. Thus,. In cases where the State or Regional Transport Authority has not communicated the order of refusal passed to the persons concerned, the period of limitation for filing an appeal would commence from the date when the parties concerned acquire knowledge of passing of the said order. - (v) To render all such services to policyholders conducive to better policy servicing.', 'caseanalysis' => null, 'casesref' => 'Life Insurance Corporation of India v. Union of India;', 'citingcases' => '', 'counselplain' => ' N.L. Sharda, Adv.', 'counseldef' => '', 'court' => 'Punjab and Haryana', 'court_type' => 'HC', 'decidedon' => '2006-04-21', 'deposition' => 'Appeal dismissed', 'favorof' => null, 'findings' => null, 'judge' => ' Adarsh Kumar Goel and; Rajesh Bindal, JJ.', 'judgement' => '<p style="text-align: justify;">1. The Revenue has approached this Court by filing the present appeal raising the following substantial question of law arising out of the order dt. 15th July, 2005 passed in ITA No. 543/Chd/2003 for the asst. yr. 2000-01:</p><p style="text-align: justify;">Whether, on the facts and in the circumstances of the case, the Hon'ble Tribunal has erred in holding that the payment made to its Development Officer by the LIC of India under the Reimbursement of Expenses Scheme, 1997 is not the income of the assessee and further it is not a part of salary of the recipient Development Officer ignoring the factual position that details of expenses incurred have not been reported to the branch manager (paying officer) on the basis of which it could be inferred that these allowances were the reimbursement of actual expenses?</p><p style="text-align: justify;">2. The ITO rejected the contention of the assessee to the effect that in the year 1997 LIC of India framed two separate schemes, namely, Incentive Bonus Scheme, 1997 and Reimbursement of Expenses Scheme, 1997. The amounts paid to the Development. Officer under the Incentive Bonus Scheme, was taxable and the income-tax was being deducted thereon as per the rules whereas the expenses reimbursed under the Reimbursement of Expenses Scheme, since were not taxable, the same was not being treated as part of salary of the Development Officer and, hence, no deduction was being made thereon.</p><p style="text-align: justify;">3. We have heard Dr. N.L. Sharda, advocate, counsel for the Revenue. A perusal of the substantial question of law sought to be raised shows that the same is not happily worded. However, still we thought it appropriate to go into the substance of the matter. The Revenue, in the present appeal, is seeking to dispute the taxability of expenses reimbursed to the Development Officer of the LIC of India under Reimbursement of Expenses Scheme, 1997.</p><p style="text-align: justify;">4. In proceedings initiated under Section 201(1) of the IT Act (for short 'the Act') r/w Sections 192 and 201(1A) of the Act, the Revenue treated the assessee in default for not deducting the tax on a sum of Rs. 4,44,570 at source. Assessee was further held liable to pay mandatory interest. The primary reason given by the AO was that the expenses reimbursed by the LIC to its Development Officers under the Reimbursement of Expenses Scheme, 1997 were actually to be treated as a part of the salary of the Development Officer, hence, TDS was required to be deducted thereon.</p><p style="text-align: justify;">The assessee went in appeal before the CIT(A) against the order of ITO which was accepted on the ground that the earlier appeal of Bamala Branch filed by LIC of India for the year 1999-2000 had been accepted on the same issue.</p><p style="text-align: justify;">The Revenue went in appeal before the Tribunal against the order passed by the CIT(A) and reiterated its stand that the payments made to Development Officer under Reimbursement of Expenses Scheme, 1997, are to be treated as part of the salary of the Development Officer, hence, TDS was required to be deducted thereon. On the other hand, the assessee, inter alia, referred two earlier orders in ITA Nos. 218, 209 and 216/Chd/2002 dt. 30th April, 2004 of the Tribunal in the case of the assessee wherein the issue was decided against the Revenue and in favour of the assessee, which orders were not appealed against.</p><p style="text-align: justify;">Besides this, the assessee also referred to a judgment of Rajasthan High Court in Life Insurance Corporation of India v. Union of India wherein it is held as under:</p><p style="text-align: justify;">The LIC of India is a statutory body. The duties of a Development Officer are provided under the relevant rules, which are extracted as follows:</p><p style="text-align: justify;">Duties of Development Officers and obligations.-A (i) To develop and increase the production of the life insurance business in a planned way as far as may be practicable in the area that may be allotted to work from time to time through the agents placed under his supervision by the Corporation and in consonance with the corporate objectives of the Corporation.</p><p style="text-align: justify;">(ii) To guide, to supervise and direct the activities of the agents placed under his supervision by the Corporation.</p><p style="text-align: justify;">(iii) To introduce suitable persons to the Corporation for appointment as new agents.</p><p style="text-align: justify;">(iv) To act generally in such a way as to activise existing agents and motivate new agents so as to develop a stable agency force.</p><p style="text-align: justify;">(v) To render all such services to policyholders conducive to better policy servicing.</p><p style="text-align: justify;">(vi) To carry out the investigation of claims, revival of lapsed policies and liaison work in connection with S.S.S. business.</p><p style="text-align: justify;">(vii) To perform such other duties as may be entrusted to him.</p><p style="text-align: justify;">It is, thus, clear that the Development Officers of the LIC are full-time employees of the corporation whose main task is to develop the business in life insurance. They are required to discharge the duties and obligations which, inter aha, include development of life insurance business of the Corporation. The very first duty enumerated for the Development Officer is to develop and increase the production of new insurance business in the planned way, as far as practicable in the area that may be allotted to him from time to time. The other duties and obligations include the duty to supervise and to guide the activities of the agents placed under the supervision of the Development Officers; to recruit new agents so as to develop agency force; and to act generally in such a way as to activate existing agents and to motivate new agents and to render certain services to policyholders. The officer is also required to perform such duties that are entrusted and assigned to him from time to time.</p><p style="text-align: justify;">As per the practice, the LIC has been giving the utilisation certificate for the purpose of income-tax as follows:</p><p style="text-align: justify;">This is to certify that during the financial year... (assessment year....), Shri. ..., has been paid Rs. ...to meet the expenses wholly, necessarily and exclusively incurred in performance of development duty and that the said amount has actually been incurred wholly for that purpose. As such this amount is exempt from income-tax under Section 10(14) of the IT Act, 1961, and, therefore, no tax has been deducted at source thereon.</p><p style="text-align: justify;">(Branch Manager).</p><p style="text-align: justify;">It is, thus, evident that the conveyance allowance and the additional conveyance allowance are paid to the Development Officers for meeting actual expenditure incurred by them in discharge of their field duties and, thus, wholly, necessarily and exclusively for meeting such expenditure, the allowance is being exempt as per the norms set out in the LIC Circular dt. 3rd Aug., 1987, referred to in the preceding para. It appears that the LIC has worked out the additional conveyance allowance to the Development Officers considering the probable expenditure for procuring the business. The LIC appears to have devised the general formula having a reference to the parameters of the business and, thus, the payment of additional conveyance allowance is a reimbursement for actual expenditure incurred by the Development Officers on account of conveyance in relation to performance of their duties and the said expenditure has a direct nexus with the performance of duties for development of the insurance business by way of meeting several people and to enroll new life insurance agents and to meet the insurance persons for encouraging them to take insurance policies. Naturally, in such circumstances, touring expenses are incurred on conveyance. Such conveyance expenses are reimbursed by the employer as per the prescribed norms in the name of additional conveyance allowance. The certificate is given by the LIC-employer of the minimum amount which the LIC certifies that it is the amount actually spent by the Development Officers in the performance of their duties. The ultimate liability of claiming exemption and proving the same is on the employee-assessee (Development Officers). The exemption limit is restricted by the instructions issued by the CBDT from time to time. Therefore, we hold that the Development Officers in the LIC are entitled to claim exemption under Section 10(14) of the Act in respect of conveyance allowance/additional conveyance allowance upon satisfying the conditions that such allowances have actually been spent for the purpose for which they were given wholly, necessarily and exclusively in the performance of duties. Therefore, the LIC cannot be insisted for deduction of tax to be deducted at source to the extent such conveyance allowance/additional conveyance allowance is exempt under Rule 2BB and further such minimum limit is set from time to time. The ultimate liability of claiming exemption and proving the same is on the employee-assessee, i.e. the Development Officers.</p><p style="text-align: justify;">5. The Tribunal after detailed discussion on the contentions of the parties and also keeping in view the fact that the Revenue had not challenged the earlier orders passed by the Tribunal on the same issue, pertaining to different offices of LIC, upheld the order passed by the CFT(A) and dismissed the appeal of the Revenue.</p><p style="text-align: justify;">6. For the reasons given above and respectfully concurring with the view taken by Rajasthan High Court in LIC's case (supra), we do not find any reason to differ from the view taken by the Tribunal and hold that no substantial question of law arises in the present case.</p><p style="text-align: justify;">7. Faced with this the counsel for the Revenue raised the plea that the expenses claimed by the assessee were not admissible to the extent that they had been claimed. We are afraid this plea of the assessee (sic-Revenue) does not fit in the domain of a substantial question of law, if examined on the guiding principles laid down for entertaining of appeals under Section 260A of the Act.</p><p style="text-align: justify;">In view of our above discussions the appeal is dismissed in limine.<p style="text-align: justify;"></p><p style="text-align: justify;">', 'observations' => null, 'overruledby' => null, 'prhistory' => '', 'pubs' => '(2006)203CTR(P& H)603; [2008]298ITR358(P& H)', 'ratiodecidendi' => '', 'respondent' => 'Branch Manager, Lic of India', 'sub' => 'Direct Taxation', 'link' => null, 'circuit' => null ) ), 'args' => array( (int) 0 => '622869' ) ) $title_for_layout = 'Commissioner of Income Tax Vs. Branch Manager, Lic of India Semantic Analysis' $shops = array( 'LAW' => array( (int) 0 => 'Section 201(1', (int) 1 => 'the IT Act', (int) 2 => 'Section 10(14', (int) 3 => 'the IT Act', (int) 4 => 'the Development Officers', (int) 5 => 'Section 10(14', (int) 6 => 'Rule 2BB', (int) 7 => 'Section 260A of the Act' ), 'CARDINAL' => array( (int) 0 => '1', (int) 1 => '543', (int) 2 => 'two', (int) 3 => '1997.4', (int) 4 => '192', (int) 5 => '201(1A', (int) 6 => 'two', (int) 7 => '218', (int) 8 => '209', (int) 9 => '216' ), 'ORG' => array( (int) 0 => 'Court', (int) 1 => 'ITA No', (int) 2 => 'the Hon'ble Tribunal', (int) 3 => 'the Reimbursement of Expenses Scheme', (int) 4 => 'ITO', (int) 5 => 'Incentive Bonus Scheme', (int) 6 => 'Reimbursement of Expenses Scheme', (int) 7 => 'the Incentive Bonus Scheme', (int) 8 => 'the Reimbursement of Expenses Scheme', (int) 9 => 'Reimbursement of Expenses Scheme', (int) 10 => 'AO', (int) 11 => 'LIC', (int) 12 => 'the Reimbursement of Expenses Scheme', (int) 13 => 'TDS', (int) 14 => 'ITO', (int) 15 => 'Bamala Branch', (int) 16 => 'LIC', (int) 17 => 'Tribunal', (int) 18 => 'Development Officer', (int) 19 => 'Reimbursement of Expenses Scheme', (int) 20 => 'TDS', (int) 21 => 'inter alia', (int) 22 => 'ITA Nos', (int) 23 => 'Rajasthan High Court', (int) 24 => 'Life Insurance Corporation of', (int) 25 => 'Union of India', (int) 26 => 'Corporation', (int) 27 => 'Corporation', (int) 28 => 'LIC', (int) 29 => 'Corporation', (int) 30 => 'LIC', (int) 31 => 'LIC', (int) 32 => 'LIC', (int) 33 => 'LIC', (int) 34 => 'the Development Officers', (int) 35 => 'CBDT', (int) 36 => 'LIC', (int) 37 => 'LIC', (int) 38 => 'Tribunal', (int) 39 => 'the Tribunal on the same', (int) 40 => 'LIC', (int) 41 => 'Rajasthan High Court', (int) 42 => 'LIC', (int) 43 => 'Tribunal' ), 'DATE' => array( (int) 0 => '15th July, 2005', (int) 1 => '2000-01', (int) 2 => '1997', (int) 3 => 'the year 1997', (int) 4 => '1997', (int) 5 => '1997', (int) 6 => '4,44,570', (int) 7 => '1997', (int) 8 => 'the year 1999-2000', (int) 9 => '1997', (int) 10 => '30th April, 2004', (int) 11 => 'the financial year', (int) 12 => '1961', (int) 13 => '3rd Aug., 1987' ), 'GPE' => array( (int) 0 => 'India', (int) 1 => 'India', (int) 2 => 'India', (int) 3 => 'India', (int) 4 => 'India', (int) 5 => 'S.S.S.' ), 'PERSON' => array( (int) 0 => 'N.L. Sharda', (int) 1 => 'servicing.(vi', (int) 2 => 'Shri' ), 'ORDINAL' => array( (int) 0 => 'first' ) ) $desc = array( 'Judgement' => array( 'id' => '622869', 'acts' => '<a href="/act/51330/income-tax-act-1961-complete-act">Income Tax Act, 1961</a> - Sections 10(14), 192, 201(1), 201(1A) and 260A', 'appealno' => 'IT Appeal No. 645 of 2005', 'appellant' => 'Commissioner of Income Tax', 'authreffered' => '', 'casename' => 'Commissioner of Income Tax Vs. Branch Manager, Lic of India', 'casenote' => ' - Sections 80 (2) & 89 & Punjab Motor Vehicles Rules, 1989, Rules 85 & 80: [T.S. Thakur, CJ, Jasbir Singh & Surya Kant, JJ] Appeal against orders of State or Regional Transport authority imitation Held, A stipulation regarding the period of limitation available for invoking the remedy shall have to be strictly construed. That is because any provision by way of limitation is in the nature of a restraint on the remedy provided under the Act. So viewed two inferences are clear viz., (1) Sections 80 and 89 of the Act read with Rule 85 of the Rules make it obligatory for the authorities making the order to communicate it to the applicant concerned and (2) the period of limitation for any appeal against the order is reckonable from the date of such communication of the reasons would imply communication of a copy of the written order itself, a party who knows about the making of an order cannot ignore the same and allow grass to grow under its feet and do nothing except waiting for a formal communication of the order or to choose a tenuous plea that even though he knew about the order, he was waiting for its formal communication to seek redress against the same in appeal. If a party does not know about the making of the order either actually or constructively it may claim that the period of limitation would start running from the date it acquires knowledge of the making of an order but one cannot understand how a party, who has acquired knowledge of the making an order either directly or constructively can ignore the same and belatedly seek redress just because the authority making the order had made a default in formally communicating the order to him. Allowing a party to do so would amount to placing a premium on the lack of diligence of a party, who is remiss in seeking a remedy that was available to it. Therefore, knowledge whether actual or construction of the order passed by the State or Regional Transport Authority should result in commencement of the period of limitation. Thus,. In cases where the State or Regional Transport Authority has not communicated the order of refusal passed to the persons concerned, the period of limitation for filing an appeal would commence from the date when the parties concerned acquire knowledge of passing of the said order. - (v) To render all such services to policyholders conducive to better policy servicing.', 'caseanalysis' => null, 'casesref' => 'Life Insurance Corporation of India v. Union of India;', 'citingcases' => '', 'counselplain' => ' N.L. Sharda, Adv.', 'counseldef' => '', 'court' => 'Punjab and Haryana', 'court_type' => 'HC', 'decidedon' => '2006-04-21', 'deposition' => 'Appeal dismissed', 'favorof' => null, 'findings' => null, 'judge' => ' Adarsh Kumar Goel and; Rajesh Bindal, JJ.', 'judgement' => '<p style="text-align: justify;">1. The Revenue has approached this Court by filing the present appeal raising the following substantial question of law arising out of the order dt. 15th July, 2005 passed in ITA No. 543/Chd/2003 for the asst. yr. 2000-01:</p><p style="text-align: justify;">Whether, on the facts and in the circumstances of the case, the Hon'ble Tribunal has erred in holding that the payment made to its Development Officer by the LIC of India under the Reimbursement of Expenses Scheme, 1997 is not the income of the assessee and further it is not a part of salary of the recipient Development Officer ignoring the factual position that details of expenses incurred have not been reported to the branch manager (paying officer) on the basis of which it could be inferred that these allowances were the reimbursement of actual expenses?</p><p style="text-align: justify;">2. The ITO rejected the contention of the assessee to the effect that in the year 1997 LIC of India framed two separate schemes, namely, Incentive Bonus Scheme, 1997 and Reimbursement of Expenses Scheme, 1997. The amounts paid to the Development. Officer under the Incentive Bonus Scheme, was taxable and the income-tax was being deducted thereon as per the rules whereas the expenses reimbursed under the Reimbursement of Expenses Scheme, since were not taxable, the same was not being treated as part of salary of the Development Officer and, hence, no deduction was being made thereon.</p><p style="text-align: justify;">3. We have heard Dr. N.L. Sharda, advocate, counsel for the Revenue. A perusal of the substantial question of law sought to be raised shows that the same is not happily worded. However, still we thought it appropriate to go into the substance of the matter. The Revenue, in the present appeal, is seeking to dispute the taxability of expenses reimbursed to the Development Officer of the LIC of India under Reimbursement of Expenses Scheme, 1997.</p><p style="text-align: justify;">4. In proceedings initiated under Section 201(1) of the IT Act (for short 'the Act') r/w Sections 192 and 201(1A) of the Act, the Revenue treated the assessee in default for not deducting the tax on a sum of Rs. 4,44,570 at source. Assessee was further held liable to pay mandatory interest. The primary reason given by the AO was that the expenses reimbursed by the LIC to its Development Officers under the Reimbursement of Expenses Scheme, 1997 were actually to be treated as a part of the salary of the Development Officer, hence, TDS was required to be deducted thereon.</p><p style="text-align: justify;">The assessee went in appeal before the CIT(A) against the order of ITO which was accepted on the ground that the earlier appeal of Bamala Branch filed by LIC of India for the year 1999-2000 had been accepted on the same issue.</p><p style="text-align: justify;">The Revenue went in appeal before the Tribunal against the order passed by the CIT(A) and reiterated its stand that the payments made to Development Officer under Reimbursement of Expenses Scheme, 1997, are to be treated as part of the salary of the Development Officer, hence, TDS was required to be deducted thereon. On the other hand, the assessee, inter alia, referred two earlier orders in ITA Nos. 218, 209 and 216/Chd/2002 dt. 30th April, 2004 of the Tribunal in the case of the assessee wherein the issue was decided against the Revenue and in favour of the assessee, which orders were not appealed against.</p><p style="text-align: justify;">Besides this, the assessee also referred to a judgment of Rajasthan High Court in Life Insurance Corporation of India v. Union of India wherein it is held as under:</p><p style="text-align: justify;">The LIC of India is a statutory body. The duties of a Development Officer are provided under the relevant rules, which are extracted as follows:</p><p style="text-align: justify;">Duties of Development Officers and obligations.-A (i) To develop and increase the production of the life insurance business in a planned way as far as may be practicable in the area that may be allotted to work from time to time through the agents placed under his supervision by the Corporation and in consonance with the corporate objectives of the Corporation.</p><p style="text-align: justify;">(ii) To guide, to supervise and direct the activities of the agents placed under his supervision by the Corporation.</p><p style="text-align: justify;">(iii) To introduce suitable persons to the Corporation for appointment as new agents.</p><p style="text-align: justify;">(iv) To act generally in such a way as to activise existing agents and motivate new agents so as to develop a stable agency force.</p><p style="text-align: justify;">(v) To render all such services to policyholders conducive to better policy servicing.</p><p style="text-align: justify;">(vi) To carry out the investigation of claims, revival of lapsed policies and liaison work in connection with S.S.S. business.</p><p style="text-align: justify;">(vii) To perform such other duties as may be entrusted to him.</p><p style="text-align: justify;">It is, thus, clear that the Development Officers of the LIC are full-time employees of the corporation whose main task is to develop the business in life insurance. They are required to discharge the duties and obligations which, inter aha, include development of life insurance business of the Corporation. The very first duty enumerated for the Development Officer is to develop and increase the production of new insurance business in the planned way, as far as practicable in the area that may be allotted to him from time to time. The other duties and obligations include the duty to supervise and to guide the activities of the agents placed under the supervision of the Development Officers; to recruit new agents so as to develop agency force; and to act generally in such a way as to activate existing agents and to motivate new agents and to render certain services to policyholders. The officer is also required to perform such duties that are entrusted and assigned to him from time to time.</p><p style="text-align: justify;">As per the practice, the LIC has been giving the utilisation certificate for the purpose of income-tax as follows:</p><p style="text-align: justify;">This is to certify that during the financial year... (assessment year....), Shri. ..., has been paid Rs. ...to meet the expenses wholly, necessarily and exclusively incurred in performance of development duty and that the said amount has actually been incurred wholly for that purpose. As such this amount is exempt from income-tax under Section 10(14) of the IT Act, 1961, and, therefore, no tax has been deducted at source thereon.</p><p style="text-align: justify;">(Branch Manager).</p><p style="text-align: justify;">It is, thus, evident that the conveyance allowance and the additional conveyance allowance are paid to the Development Officers for meeting actual expenditure incurred by them in discharge of their field duties and, thus, wholly, necessarily and exclusively for meeting such expenditure, the allowance is being exempt as per the norms set out in the LIC Circular dt. 3rd Aug., 1987, referred to in the preceding para. It appears that the LIC has worked out the additional conveyance allowance to the Development Officers considering the probable expenditure for procuring the business. The LIC appears to have devised the general formula having a reference to the parameters of the business and, thus, the payment of additional conveyance allowance is a reimbursement for actual expenditure incurred by the Development Officers on account of conveyance in relation to performance of their duties and the said expenditure has a direct nexus with the performance of duties for development of the insurance business by way of meeting several people and to enroll new life insurance agents and to meet the insurance persons for encouraging them to take insurance policies. Naturally, in such circumstances, touring expenses are incurred on conveyance. Such conveyance expenses are reimbursed by the employer as per the prescribed norms in the name of additional conveyance allowance. The certificate is given by the LIC-employer of the minimum amount which the LIC certifies that it is the amount actually spent by the Development Officers in the performance of their duties. The ultimate liability of claiming exemption and proving the same is on the employee-assessee (Development Officers). The exemption limit is restricted by the instructions issued by the CBDT from time to time. Therefore, we hold that the Development Officers in the LIC are entitled to claim exemption under Section 10(14) of the Act in respect of conveyance allowance/additional conveyance allowance upon satisfying the conditions that such allowances have actually been spent for the purpose for which they were given wholly, necessarily and exclusively in the performance of duties. Therefore, the LIC cannot be insisted for deduction of tax to be deducted at source to the extent such conveyance allowance/additional conveyance allowance is exempt under Rule 2BB and further such minimum limit is set from time to time. The ultimate liability of claiming exemption and proving the same is on the employee-assessee, i.e. the Development Officers.</p><p style="text-align: justify;">5. The Tribunal after detailed discussion on the contentions of the parties and also keeping in view the fact that the Revenue had not challenged the earlier orders passed by the Tribunal on the same issue, pertaining to different offices of LIC, upheld the order passed by the CFT(A) and dismissed the appeal of the Revenue.</p><p style="text-align: justify;">6. For the reasons given above and respectfully concurring with the view taken by Rajasthan High Court in LIC's case (supra), we do not find any reason to differ from the view taken by the Tribunal and hold that no substantial question of law arises in the present case.</p><p style="text-align: justify;">7. Faced with this the counsel for the Revenue raised the plea that the expenses claimed by the assessee were not admissible to the extent that they had been claimed. We are afraid this plea of the assessee (sic-Revenue) does not fit in the domain of a substantial question of law, if examined on the guiding principles laid down for entertaining of appeals under Section 260A of the Act.</p><p style="text-align: justify;">In view of our above discussions the appeal is dismissed in limine.<p style="text-align: justify;"></p><p style="text-align: justify;">', 'observations' => null, 'overruledby' => null, 'prhistory' => '', 'pubs' => '(2006)203CTR(P& H)603; [2008]298ITR358(P& H)', 'ratiodecidendi' => '', 'respondent' => 'Branch Manager, Lic of India', 'sub' => 'Direct Taxation', 'link' => null, 'circuit' => null ) ) $args = array( (int) 0 => '622869' ) $pattern = '/\(((0[1-9]|[12][0-9]|3[01])[.](0[1-9]|1[012])[.](17|18|19|20)[0-9]{2}).*\)/' $shops2 = nullinclude - APP/View/Case/meta.ctp, line 39 View::_evaluate() - CORE/Cake/View/View.php, line 971 View::_render() - CORE/Cake/View/View.php, line 933 View::render() - CORE/Cake/View/View.php, line 473 Controller::render() - CORE/Cake/Controller/Controller.php, line 963 Dispatcher::_invoke() - CORE/Cake/Routing/Dispatcher.php, line 200 Dispatcher::dispatch() - CORE/Cake/Routing/Dispatcher.php, line 167 [main] - APP/webroot/index.php, line 109
LAW: Section 201(1, the IT Act, Section 10(14, the IT Act, the Development Officers, Section 10(14, Rule 2BB, Section 260A of the Act
CARDINAL: 1, 543, two, 1997.4, 192, 201(1A, two, 218, 209, 216
ORG: Court, ITA No, the Hon'ble Tribunal, the Reimbursement of Expenses Scheme, ITO, Incentive Bonus Scheme, Reimbursement of Expenses Scheme, the Incentive Bonus Scheme, the Reimbursement of Expenses Scheme, Reimbursement of Expenses Scheme, AO, LIC, the Reimbursement of Expenses Scheme, TDS, ITO, Bamala Branch, LIC, Tribunal, Development Officer, Reimbursement of Expenses Scheme, TDS, inter alia, ITA Nos, Rajasthan High Court, Life Insurance Corporation of, Union of India, Corporation, Corporation, LIC, Corporation, LIC, LIC, LIC, LIC, the Development Officers, CBDT, LIC, LIC, Tribunal, the Tribunal on the same, LIC, Rajasthan High Court, LIC, Tribunal
DATE: 15th July, 2005, 2000-01, 1997, the year 1997, 1997, 1997, 4,44,570, 1997, the year 1999-2000, 1997, 30th April, 2004, the financial year, 1961, 3rd Aug., 1987
GPE: India, India, India, India, India, S.S.S.
PERSON: N.L. Sharda, servicing.(vi, Shri
ORDINAL: first