Capt. Harminder Singh vs Income Tax Officer.
1997 Latest Caselaw 374 Del

ORDER

B. S. SALUJA, J.M. :

The assessee has filed this appeal against the order of CIT(A)-XXII, New Delhi, dt. 31st October, 1994, on the following grounds :

1. On the facts and in the circumstances of the case, the learned CIT(A) XXII, New Delhi has erred :

(a) in holding that out of total allowance of Rs. 90,169 drawn by the appellant, a sum of Rs. 60,169 was taxable and only a sum of Rs. 30,000 was exempt under s. 10(14)(ii).

(b) in not treating the said allowance as exempt under Notification No. 143(E), dt. 21st February, 1989 issued under s. 10(14)(i).

2. Without prejudice to the above grounds of appeal, the learned CIT(A)-XXII has on the facts and circumstances of the case, erred in not treating as exempt even the allowances as were similar to those declared as exempt by the CBDT in their communication No. 133/118-90 TPL, dt. 30th March, 1990 addressed to Air India, Bombay".

2. Brief facts in this case are that the assessee filed return of income at Rs. 1,24,280 and the same was processed under s. 143(1)(a). The case was selected for scrutiny and notice under s. 143(2) was issued.

2.1. The AO noted that the assessees sources of income were from salary from Indian Airlines, dividend and interest, as also loss declared from house property. The AO further noted that the assessee had received allowances from the employer Indian Airlines (IAC), but the same had not been declared in the return of income, namely :

Rs.

STA

20,940

ASTA

15,225

LR

5,076

Entt. All.

5,076

MA/DR

23,484

SOA

1,478

MA/MS

10,880

2 Crew All.

8,010

Total

90,169

The AO further noted that the assessee had claimed exemption in respect of the above allowance under s. 10(14) of the IT Act. The AO examined the provisions of s. 10(14) and observed that the claim for exemption by pilots and other crew members of the Airlines - whether of public or private sectors - is regulated under the provisions of s. 10(14) (ii). He also referred to the Notification No. S.O. 143(E) dt. 21st February, 1989, and S.O. 144(E) dt. 21st February, 1989, as amended by Notification No. S.O. 259(E), dt. 27th March, 1990, S.O. 487(E), dt. 1st July, 1992, S.O. 606(E), dt. 9th June, 1989 and S.O. 267(E), dt. 29th March, 1990. He held that exemption of allowances granted to an employee working in any transport system to meet his personal expenditure during his duty performed in the course of running such transport from one place to another was available under Notification No. S.O. 144(E) dt. 21st February, 1989, upto ceiling of 70 per cent of the allowances upto a maximum of Rs. 1,000 per month till 30th June, 1992, and upto a maximum ceiling of Rs. 3,000 per month w.e.f. 1st July, 1992. He also held that the exemption would have to be limited to the expenses actually incurred for that purpose. The AO also noted the submissions made by the assessee that the entire amount of allowances received has been actually spent for the purpose and no savings had been made therefrom. The AO held that the exemption of the aforementioned allowances was to be restricted to 70 per cent and that the maximum allowable under s. 10(14)(ii) was, therefore, Rs. 30,000 in the assessment year under consideration. He, therefore, disallowed an amount of Rs. 60,169.

3. On first appeal, the learned counsel for the assessee submitted that the aforesaid allowances given to the assessee are totally exempt under s. 10(14)(i), because the said allowances or benefits have been specifically granted to meet the expenses wholly, necessarily and exclusively incurred in the performance of the duties of office or employment of profit and the same were duly covered by the Notification issued by the Central Govt. He also invited the attention of the learned CIT(A) to Instruction No. 1107, dt. 5th October, 1977, issued by the CBDT in which it was clearly advised that special travelling allowances or any similar allowances fell within the scope of s. 10(14) and were exempt to the extent they were actually incurred by the recipients. He further pointed out that even though the provisions of s. 10(14) were amended w.e.f. 1st April, 1989, CBDTs Circular 1107 would continue to be valid even in the changed scenario. He also contended that the assessee had duly declared the salary income in his return based on the salary/TDS certificate issued by the IAC and the employer had considered the aforesaid allowances as exempt under s. 10(14)(i). He also contended that otherwise IAC would have included such allowances in the taxable salary and deducted tax at source. He also contended that the Notification relied upon by the AO was not relevant and in fact, the aforesaid allowances should be treated as fully exempt under s. 10(14)(i), because the assessee had actually spent the said amounts for the purpose for which they had been given. He also contended that if two interpretations of any provision were possible, the interpretation beneficial to the assessee must prevail.

3.1. The learned CIT(A) considered the submissions and observed that the amendment made by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1st April, 1989, ushered in complete change in the scenario of such special allowances as laid down in s. 10(14) of the IT Act. The learned CIT(A) then examined the legislative history of the provisions of s. 10(14), right from the stage of s. 4(3)(vi) of the Indian IT Act, 1922, and observed that the language of s. 10(14) clearly shows that any special allowance or benefit specifically granted to meet expenses wholly, necessarily and exclusively incurred in the performance of the duties would be exempt. He also observed that the legislature did not, however, intend a blanket and all pervasive exemption. He also observed that on the contrary, the legislature has laid down that such exemption is available only if and so far as an employee is able to establish that the said allowance received has been expended and that such expenses have been actually incurred by him in the performance of his duties as an employee. He further referred to the provisions of the Explanation inserted in s. 10(14) in 1977, whereby it was made explicit that any allowance granted to a person to meet his personal expenses at the place where the duties of his office or employment of profit are ordinarily performed by him or of the place where he ordinarily resides shall not be regarded as a special allowance granted to meet the expenses, wholly, necessarily and exclusively incurred in the performance of such duties. In this connection, he further observed that the intention of legislature was to make city compensatory allowance taxable as a sequel to a judicial pronouncement in the case of CIT vs. D. R. Pathak (1971) 79 ITR 14 (Bom). He also observed that till the asst. yr. 1989-90 all sorts of special allowances were governed by s. 10(14) and that thereafter in order to set at rest the controversy generated in respect of the various allowances, the provisions of s. 10(14) were substituted w.e.f. 1st April, 1989. After referring to the revised provisions, the learned CIT(A) further observed that while the earlier provisions have been retained in the newly substituted clauses, the only change envisaged is that the earlier discretion allowed to the Court to uphold or not to uphold the exemption of special allowance from tax has been replaced by the power being vested with the Central Govt. to notify such special allowances as would be entitled to exemption under the said provisions. The learned CIT(A) also observed that w.e.f. 1st April, 1989, exemption is available to an employee in respect of the allowances granted to him only if a notification is issued under the relevant clauses of s. 10(14) by the Central Govt. exempting such allowances. He also observed that the exemption in such cases will be available only to the extent specified in the said notification. He also observed that the Central Govt. has now retained the reins in its hand to notify the exemptions in respect of both sub-cls. (i) and (ii) of cl. (14) of s. 10. He, therefore, concluded that the legislative history shows that the areas of exemptions available to various segments have been specified by the Central Govt. by way of specific notifications issued under those provisions. The learned CIT(A) further referred to Notification Nos. S.O. 143(E) and S.O. 144(E), dt. 21st February, 1989 , and further amendments made in Notification No. S.O. 144(E) . He further referred to Sl. No. 4 of Notification No. S.O. 144(E) and held that the employees of the IAC are working in a transport system and that they will be covered within the mischief of provisions of s. 10(14)(ii) read with the said Notification No. S.O. 144(E), dt. 21st February, 1989 [(1989) 76 CTR (St) 97] as the employees of the transport system and clearly mentioned in item 4 of that notification. He also observed that "It is well settled that in a taxing Act, one has to look merely at what is clearly said. There is no room for intendment. Nothing is to be read in and nothing is to be implied Dakshini Moorthy Mudaliar vs. TRO (1993) 202 ITR 946 (Mad). The underlying principle is that the meaning and intention of the legislature/statute must be collected from the plain and unambiguous expression used therein rather than from any notions. The express intention must guide any Court of law [CIT vs. Orissa State Warehousing Corpn. (1993) 201 ITR 729 (Ori)]. It flows from the above that the allowances availed by the employees of a transport system inclusive of the pilots of Indian Airlines are to be governed by the express provisions as discussed above as a sequel to the evolution of the legislative history". The learned CIT(A) further held that the provisions of s. 10(14)(i) are not applicable to the employees working in the transport system, including airlines-both public and private sectors. The learned CIT(A) also observed that non-deduction of tax at source by the employer would not impart a legal aura to the assessees claim with reference to the exemption of the said allowances. The learned CIT(A), thus, upheld the orders of the AO that the assessee was only entitled to exemption of Rs. 30,000 out of the aforesaid allowances and that the remaining amount of Rs. 60,169 was properly disallowed. The assessee is aggrieved.

4. The learned counsel for the assessee Dr. Devi Pal referred to the provisions of s. 10(14), as they existed before 1st April, 1989, and as they were amended w.e.f. 1st April, 1989, and submitted that there is no material change except that now allowances which are to be exempted are required to be notified by the Central Govt. He referred to the nature of various allowances, namely, special travelling allowance, additional special travelling allowance, light refreshment allowance, meal allowance, stay over allowance, entertainment allowance and two crew allowance and submitted that these allowances are not in the nature of perquisites so as to attract the provisions of s. 17. A short note on the nature of these allowances has also been placed before the Tribunal. It has been mentioned in the said note that special travelling allowance and additional special travelling allowance is granted to pilots as reimbursement of additional expenses incurred by them in their capacity as members/senior members of the crew. In this connection, reference has been made to Instruction No. 1107, dt. 5th October, 1977, issued by the CBDT wherein the Board has mentioned in para 4 that the said allowances come within the scope of s. 10(14) of the IT Act, 1961, and that they would be exempt to the extent the expenses actually incurred by the recipients. It is further mentioned in the said note that light refreshment allowance is by way of reimbursement to meet the cost of refreshments at the airport. Similarly, it is mentioned that the crew members have to go to various places and are required to stay there and that meal allowances are given to meet the expenses required to be incurred by the crew members on meals during stay away from the normal place of posting. It is also mentioned that a stay over allowance is paid to the crew members to meet pocket expenses other than on meals during their stay away from the place of normal place of duty. With reference to entertainment allowance it is mentioned that the same is paid to senior pilots to reimburse the cost of official entertainment, while on tour. Similarly, two crew allowance is included in allowance and that the Indian Airlines has already paid the requisite tax, along with interest under s. 201(1A) on this allowance.

4.1. The learned counsel then referred to the provisions of s. 10(14), as they stood before 1st April, 1989, and stated that the aforesaid allowances have been specifically granted to the employees to meet expenses wholly, necessarily and exclusively incurred in the performance of the duties of an office. He further submitted that the last requirement of the said provisions is that the expenses should have been actually incurred for the purpose for which they have been granted. He further referred to the Expln. to cl. (14) whereunder it was clarified that any allowance granted to an assessee to meet his personal expenses at the place where the duties of his office or employment are ordinarily performed by him or at the place where he ordinarily resides shall not be regarded as a special allowance granted to meet expenses wholly, necessarily and exclusively incurred in the performance of such duties. He further submitted that the provisions of the said Explanation were actually in the nature of a proviso and that the legislature had made a distinction between the personal expenses incurred at the place of duty and the expenses made in the performance of duty. He further submitted that the provisions of the Explanation have now been introduced w.e.f. 1st April, 1989, as sub-cl. (ii) in cl. (14). He also referred to the proviso to new sub-cl. (ii) and submitted that the provisions contained therein were also relevant, as sub-cl. (ii) will not 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 unless such allowance is related to the place of his posting or residence. He emphasised that there is no basic difference between the old provisions of s. 10(14) and the new provisions of that clause introduced w.e.f. 1st April, 1989. In this connection, he referred to Instruction No. 778, dt. 30th October, 1974 issued by the CBDT (pp. 1-4 of the paper book), whereby the CBDT had laid down uniform guidelines relating to exemption of certain allowances granted to pilots of Air India and IAC. It was mentioned in the said instructions that special travelling allowance @ Rs. 48 per day was only a form of additional remuneration and should be taxed in full as salary. It was also mentioned that stay over allowance, meal allowance and light refreshment allowance will remain tax-free. The Board has also accepted that kit maintenance allowance to the extent of Rs. 50 per month is covered by s. 10(14) and that the excess of Rs. 100 per month should be subjected to tax. The Board also held that the amount of premia reimbursed in respect of insurance against loss of licence fell within s. 17(2) and should be subjected to tax as perquisite. The Board also clarified that the house rent allowance and certain other allowances such as telephone allowance, transport/conveyance allowance, free and concessional passage, medical fees need not be subjected to tax. He further referred to the clarification issued on 24th July, 1976, in relation to Instruction 778 (pp. 5-7 of the paper book), wherein it was clarified that kit maintenance allowance is covered by s. 10(14) and the same would be exempt. He further referred to Instruction 1107, dt. 5th October, 1977 (pp. 8-9 of the paper book), wherein the Board has clarified that special travelling allowance was covered within the scope of s. 10(14) and the same would be exempt to the extent it is actually incurred by the employee. The learned counsel further invited our attention to Notification No. S.O. 143(E), dt. 21st February, 1989, issued under s. 10(14)(i) and submitted that cl. (b) of that Notification was relevant, whereunder 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 is exempted. He submitted that various allowances mentioned above are covered by the provisions of cl. (b) of the said notification as the pilots/crew members of the IAC are performing journeys on tour and the special allowances are granted to meet the ordinary daily charges incurred by the employees on account of absence from their normal place of duty. The learned counsel further invited our attention to Notification No. S.O. 144(E), dt. 21st February, 1989, as amended by Notification No. S.O. 259(E), dt. 27th March, 1990, and S.O. 487(E), dt. 1st July, 1992 (pp. 11-20 of the paper book). He referred in particular to item 4 of S.O. 144(E) which is reproduced hereunder for the sake of convenience :

"4. Any allowance granted to an employee working in any transport system to meet his personal expenditure during his duty performed in the course of running of such transport from one place to another : provided that such employee is not in receipt of daily allowance (by whatever name called) in respect of said duty performed by him."

It is mentioned in col. 4 of the said notification that 70 per cent of such allowance upto a maximum of Rs. 3,000 per month is exempted. The learned counsel submitted that the said notification has been issued under s. 10(14)(ii) and refers to allowances granted to an assessee to meet his personal expenses and to compensate him for the increased cost of living. He submitted that the tax authorities have wrongly construed the provisions of s. 10(14)(ii) and the provisions of item 4 of the said notification, in as much as, the said provisions relate to allowance granted to an assessee 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. He submitted that if the allowances are given for personal expenses in relation to places, other than the place of posting/residence, the said allowances are allowable under s. 10(14)(i) to the extent the same is actually incurred by the employee. In this connection, the learned counsel emphasised that the aforesaid allowances are not paid to the pilots/crew members with reference to place of posting/residence, but are paid to meet expenses during the performance of their duties outside the place of posting/residence. He, therefore, submitted that the quality and character of expenses is not changed because of engrafting old Explanation as new sub-cl. (ii) in cl. (14) and that the expenses still remain as expenses incurred wholly, necessarily and exclusively in the performance of duties. The learned counsel further added that the Deptt. is actually under a state of utter confusion. In this connection, he invited our attention to p. 56 of the paper book where a copy of authorisation memorandum, dt. 16th May, 1996, is placed. In the said memorandum, the learned CIT has directed the learned Dy. CIT Range (TDS)-31/Asstt. CIT Cir. (TDS)-31 (1), Mumbai, to file an appeal to the Tribunal, Mumbai Benches, against the order of CIT(A)-IX, dt. 12th March, 1996. In Ground No. 3 mentioned in the said authorisation memorandum, it is mentioned that "On the facts and circumstances of the case, the learned CIT(A) erred in holding that stay over allowance, travelling allowance, special travelling allowance, meal allowance, light refreshment allowance and entertainment allowance is to be treated under s. 10(14)(ii) and not under s. 10(14)(i) of the Act". It is further mentioned in Ground No. 3(a) that "Without prejudice to the above, the learned CIT(A) failed to appreciate (sic-that) all these allowances are in the nature of daily allowances and hence, s. 10(14)(ii) read with proviso is not applicable". In this connection, the learned counsel also invited our attention to para 14 of the order of the learned CIT(A), dt. 31st October, 1994, which is under challenge, wherein he has held that the provisions of s. 10(14)(i) of the Act are not applicable to the employees working in the transport system, including airlines public and private sector. The learned counsel further submitted that while dealing with item No. 4 of Notification No. S.O. 144(E) (pp. 19 of the paper book), the tax authorities have not taken into consideration the proviso to that item wherein it is mentioned that "Such employee is not in receipt of daily allowance (by whatever name called) in respect of the said duty performed by him". In view of the foregoing, the learned counsel submitted that the nature of allowances being given to the pilots/crew members is reimbursement of expenses by the employer and that the same are exempt. In this connection, he referred to the decision of the Tribunal, Mumbai Bench A in the case of Indian Airlines Ltd. vs. Asstt. CIT (1996) 56 TTJ (Mumbai) 573 : (1996) 59 ITD 353 (Mumbai), wherein the Tribunal has observed in para 12 at pp. 362 that "The instructions/circulars issued by the CBDT prior to the amendment, which became effective from 1st April, 1989, go to indicate that the various allowances involved, in these appeals, were treated as reimbursement of the expenditure incurred by the employees and, therefore, exempt under s. 10(14) of the Act". The Tribunal further observed that the stand of the assessee that it was of the view that these allowances are only reimbursement of the expenditure incurred by the employees and as such, they cannot form part of their income, cannot be said to be without any basis and that the belief of the assessee, on this point, was bona fide. The learned counsel further invited our attention to the letter dt. 30th March, 1990, issued by the CBDT in relation to allowances granted to Air India employees (p. 21 of the paper book). It is mentioned in para 2 of the letter that stay over allowance and special travelling allowance are already covered by Notification No. S.O. 143(E), dt. 21st February, 1989. It is further mentioned that in-flight meal allowance and entertainment allowance to flight crew are also covered by Notification No. S.O. 144(E), dt. 21st February, 1989, sl. No. 4. It is also mentioned that inertial navigation allowance, flying allowance, and lecture allowance are in the nature of special pay and the same are beyond the purview of s. 10(14). It is also mentioned that the Board is considering the kit maintenance allowance for the purpose of s. 10(14)(i). The learned counsel urged that the employees of the Indian Airlines ought to be given the same treatment as the employees of the Air India and that the Government cannot give separate treatment to the same type of allowance in relation to two organisations. The learned counsel further referred to CBDT Circular No. 701, dt. 23rd March, 1995, [published at (1995) 213 ITR 1 (St)]. In para 3 of the said circular it has been clarified that consequent to the amendment of s. 10(14) by the Direct Taxes Laws (Amendment) Act, 1987 (w.e.f. 1st April, 1989), all circulars, instructions and clarifications issued by the Board regarding s. 10(14) upto 31st March, 1989, ceased to have effect from the asst. yr. 1989-90 and onwards. The learned counsel emphasised that such a circular can only have prospective effect and that the Board has no power to withdraw the earlier circulars retrospectively. He further submitted that only legislature has powers to amend the law retrospectively. In this connection, he relied on the decision of the Supreme Court in the case of Bakul Cashew Co. & Ors. vs. STO (1986) 159 ITR 565 (SC), wherein it has been held that in case of subordinate legislation there is no power to legislate retrospectively unless such power is expressly conferred. He further relied on the decision of the Honble Kerala High Court in the case of CIT vs. B. M. Edward, India Sea Foods (1979) 119 ITR 334 (Ker), wherein it has been held that subsequent recall or withdrawal of circular does not effect the assessees right to have assessments effected or carried out in accordance with circular which is binding upon subordinate authorities. He further submitted that the aforesaid decision has been affirmed by the Honble Kerala High Court in the case of Peria Karamalai Tea & Produce Co. Ltd. vs. CIT (1980) 124 ITR 899 (Ker).

4.2. In view of the foregoing submissions the learned counsel concluded that the view taken by the Board vide Instruction Nos. 778, dt. 30th October, 1974 and 1107, dt. 5th October, 1977 is still valid and that the character of allowances has not changed due to the amendments made in s. 10(14). He further urged the Tribunal to interpret the law as the various officers of the Department have been taking different views.

5. The learned Departmental Representative relied heavily on the orders of the tax authorities. He further submitted that the learned counsel has laid great stress on the provisions of s. 10(14)(ii), proviso, which refer to performance of duties of special nature. He submitted that the pilots/crew members of the Indian Airlines are not performing any special duty and that they were only performing the normal duties of their office. He further submitted that there is no defect in the circular and various notifications as pointed out by the learned counsel and that the said circulars/notifications have legal/legislative backing and sanction. He further submitted that item 4 of Notification No. 144(E) is only limiting the extent of exemption allowable in relation to allowances granted to employees working in any transport during duty performed in the course of running of such transport from one place to another place. He further submitted that the tax authorities have rightly allowed exemption only upto the limit of Rs. 30,000 in view of the said provisions of Notification No. S.O. 144(E).

5.1. The learned counsel in his reply referred to the provisions of s. 10(14)(i) and submitted that the allowances, which are not in the nature of perquisites, have been specifically granted to meet expenses wholly, necessarily and exclusively incurred in the performance of duties. He further submitted that the duties being performed by pilots/crew members are duties of a special nature. He also submitted that the Indian Airlines was only meeting the room charges in respect of a hotel and that the other charges were being met by the employees out of the allowances paid by Indian Airlines.

6. We have carefully considered the rival submissions on the issue involved in this appeal. We have also carefully perused the orders of the tax authorities and other relevant material to which our attention has been invited during the course of hearing. We have also seen the case law relied upon by the learned counsel. It is observed that the main thrust of the arguments of the learned counsel has been that there is no basic change in the provisions of s. 10(14) as they stood before 1st April, 1989, and as they have been amended w.e.f. 1st April, 1989, by the Direct Tax Laws (Amendment) Act, 1987. He has also emphasised that the view taken by the CBDT in its earlier instructions/circulars is still valid even with reference to the provisions of s. 10(14) after amendment w.e.f. 1st April, 1989. In this connection, the learned counsel has also emphasised that the CBDT has no powers to withdraw the earlier circulars retrospectively and that the circular dt. 23rd March, 1995, issued by the CBDT will only have prospective effect. In this connection, we may refer to the decision of the Tribunal, Mumbai Bench A in the case of Indian Airlines Ltd. vs. Asstt. CIT (supra), wherein the Tribunal has upheld vide para 9 of its order the view of the CIT(A) that there was a change in law w.e.f. 1st April, 1989, and the allowances could be treated as exempt only if covered by notifications, if any, issued thereafter. The Tribunal has also held that the contention of the assessee that circular issued prior to 1st April, 1989, remained unaffected was not acceptable. The Tribunal had also held that the contention of the assessee that the earlier notifications had been withdrawn by the CBDT only on 23rd March, 1995, and till that date they would hold the field was also unacceptable. The Tribunal has clearly held that Circular No. 701, dt. 23rd March, 1995, had clarified, inter alia, that consequent to the amendment of s. 10(14) w.e.f. 1st April, 1989, all circulars, instructions and clarifications issued by the Board regarding s. 10(14) upto 31st March, 1989, ceased to have effect from the asst. yr. 1989-90 and onwards and that it was only a clarification of the legal position and it would be wrong to infer that through the said circular the earlier instructions had been withdrawn. Respectfully, following the aforesaid orders of the Tribunal we reject the contention of the learned counsel that the earlier instructions of the CBDT are still valid for purposes of interpreting the provisions of s. 10(14). In this connection, we may also make a reference to provisions of s. 24 of the General Clauses Act, 1897, which provide that where any Central Act is repealed and re-enacted, with or without modifications, then, unless it is otherwise expressly provided, any order, scheme, rule, form or bye-law made or issued under the repealed Act, shall so far as it is not inconsistent with the provisions re-enacted continue in force and be deemed to have been made or issued under the provisions so re-enacted. It is observed that in the present case there has been a basic change in the provisions of s. 10(14), as re-enacted, inasmuch as, the whole gamut of exemptions is now regulated by notifications made by the Central Govt. and published in the Official Gazette. The intention underlying the provisions of s. 24 of that Act if applied to the instructions/circulars in question is, therefore, also of no help to the assessee. The two relevant notifications which have been issued under s. 10(14) as amended are S.O. 143(E) and S.O. 144(E), dt. 21st February, 1989.

6.1. The next contention of the learned counsel in this behalf is that the allowances are granted specifically to meet expenses wholly, necessarily and exclusively incurred in the performance of the duties of office and are covered by the provisions of s. 10(14)(i). In this connection, he referred to cl. (b) of Notification No. S.O. 143(E), dt. 21st February, 1989. It is observed that cl. (b) of the said notification deals with allowances, 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. We have carefully seen the nature of various allowances as mentioned in the note placed before us and it is difficult to accept the contention of the learned counsel that the aforesaid allowances are covered by cl. (b), as we feel that the said allowances cannot be called as having been granted to the assessee in connection with tour or transfer. The allowances are being granted by Indian Airlines for performance of flying duties in the normal course of employment. We, therefore, reject the said contention of the learned counsel.

6.2. The next contention of the learned counsel is that under the provisions of s. 10(14)(ii), allowances granted to the assessee by Indian Airlines are exempt as such allowances are given not 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 but to cover his personal expenses while performing duty at other places. In this connection, he has relied on the proviso to sub-cl. (ii) which mentions that he said sub-clause shall not 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. The learned counsel has contended that all the aforesaid allowances are being paid by Indian Airlines to its pilots/crew members to meet personal expenses at places other than the places of their posting/residence. He also contended that the duties being performed are of a special nature and such expenses should be held as exempt. It is observed that sub-cl. (ii) deals with allowances granted either to meet personal expenses at places mentioned therein or to compensate a person for increased cost of living. The proviso to sub-cl. (ii) carves out an exception in the case of an allowance meant to remunerate/compensate a person performing duties of a special nature. It would mean that there will be no exemption in relation to personal allowances granted to the assessee to remunerate/compensate him for performing duties of special nature unless such allowance is related to place of posting or residence. The thrust of exemption covered by sub-cl. (ii) is, therefore, in relation to allowances granted to meet personal expenses generally incurred at the place of posting where duties are ordinarily performed or the place where an assessee ordinarily resides, or to compensate him for increased cost of living as are notified by the Central Government. It is further observed that the only relevant notification issued by the Central Government under sub-cl. (ii) is S.O. 144(E), dt. 21st February, 1989. In the preamble to the said notification it has been clearly stated that the allowance mentioned in col. 2 of the table to the said notification granted to an assessee to meet his personal expenses and to compensate him for the increased cost of living at the places mentioned in the corresponding entry in col. 3 and the maximum amount of such allowances mentioned in the corresponding entry in col. (4) of the said table are specified for the purposes of sub-cl. (ii) of cl. (14) of s. 10. We have carefully gone through the said notification and it is observed that only item 4 of the said notification is relevant to the cases under consideration whereunder allowances granted to an employee working in any transport system to meet his personal expenditure during his duty performed in the course of running of such transport from one place to another place are specified in relation to the whole of India and 70 per cent of such allowances upto maximum of Rs. 3,000 per month are exempt. In the proviso to the said item it is also mentioned that the said exemption will be admissible if the concerned employee is not in receipt of daily allowance (by whatever name called) in respect of the said duty performed by him. Whereas the first three items of S.O. 144(E) seek to cover allowances granted to a person to meet his personal expenses as also to compensate him for increased cost of living in relation to places of posting/residence in specific areas of various States, item 4 of that notification is meant to achieve the same object in relation to allowances granted to employees of transport systems operating in the whole of India. It is so because the employees in a transport system like Indian Airlines are bound to ordinarily perform their duties at different places throughout India, though they may be actually posted at specified places. We, therefore, feel that the tax authorities have rightly held that the case of the assessee is covered by the provisions of s. 10(14)(ii) r/w item 4 of Notification No. S.O. 144(E), dt. 21st February, 1989, as the purpose of granting the allowances under consideration is obviously to enable the assessee to meet his personal expenses as also to compensate him for increased cost of living at places where he ordinarily performs his duties. We therefore, see nothing wrong in the approach of the tax authorities to have taken into account all the allowances granted to the assessee (as mentioned in the assessment order) for the purposes of computing exemption under item 4 of S.O. 144(E) and restricting exemption to Rs. 30,000 during this year. We also feel that it is unnecessary to examine the extent of exemption in relation to each allowance separately. Since, the tax authorities have not held that any of the allowances under consideration is in the nature of daily allowance and falls outside the purview of item 4 of Notification No. S.O. 144(E), we also feel that it is unnecessary to go into that question.

6.3. Turning now to the question of inequality pointed out by the learned counsel between the employees of the Indian Airlines and Air India with reference to CBDT letter, dt. 30th March, 1990, we feel that the remedy lies elsewhere and not with the Tribunal.

6.4. The next question is as to whether the scope of the exemption specified in sub-cls. (i) and (ii) of cl. (14) of s. 10 is circumscribed by the notifications issued by the Central Govt. or the Tribunal can go into the objects underlying those provisions and try to supplement those provisions and the notifications issued under cl. (14). We feel that keeping in view the present provisions of the IT Act and of the Constitutional law, it is not possible for the Tribunal to play a legislative role and supplement the provisions of s. 10(14) or the notifications issued thereunder. As already observed in the earlier part of this order, the whole gamut of granting exemptions is now regulated under s. 10(14) by notifications issued by the Central Govt. by virtue of powers granted to it by the legislature. In the circumstances, the Tribunal can at best interpret the existing provisions as laid down by the legislature and further circumscribed by the executive under power delegated to it. We may refer, in this connection, to the decision of the Honble Orissa High Court in the case of CIT vs. Orissa State Warehousing Corpn (supra) wherein it has been observed that "While interpreting a taxing statute equitable considerations are entirely out of place. The Court must look clearly at the words of the statute and interpret them. It must interpret a taxing statute in the light of what is clearly expressed; it cannot imply anything which is not expressed; it cannot import the provisions in the statute so as to apply any assumed deficiency. One has to look at what is clearly stated. There is no room for any intendment. There is no equity about a tax". We may also refer to the decision of the Honble Madras High Court in the case of V. M. Dakshini Moorthy Mudaliar vs. TRO & Ors. (supra), wherein it has been observed that "In a taxing Act, one has to look merely as what is clearly said. There is no room for any intendment. Nothing is to be read in and nothing is to be implied".

6.5. In view of the foregoing we conclude that the tax authorities have rightly invoked the provisions of s. 10(14)(ii) r/w item 4 of Notification No. S.O. 144(E), dt. 21st February, 1989, and have rightly restricted the exemption in relation to all the allowances, under consideration at Rs. 30,000. Accordingly, we see no reason to interfere with the order of the learned CIT(A).

7. In the result, the appeal is dismissed.