Proof of Leave Travel Allowance
Proof of Leave Travel Allowance
The Apex court in a recent order stated that there is no statutory obligation on the employer to collect supporting evidence from the employees claiming LTA/LTC exemption and furnish it to the tax department. Currently, if LTA and conveyance claims are not supported by journey bills they would be taxed. The order came on a plea by Larsen & Toubro and ITI. The bench comprising Justice SH Kapadia and Justice Aftab said that employers are under no statutory obligation to collect supporting evidence and furnish them to tax authorities.
The court stated “the beneficiary of exemption U/s 10(5) is an individual employee. There is no circular of Central Board of Direct Taxes requiring the employer under Sec192 to collect and examine the supporting evidence to the declaration to be submitted by an employee”. However the concerned employee must retain such proofs to be presented before I-T Dept. when required.
The Apex court in a recent order stated that there is no statutory obligation on the employer to collect supporting evidence from the employees claiming LTA/LTC exemption and furnish it to the tax department. Currently, if LTA and conveyance claims are not supported by journey bills they would be taxed. The order came on a plea by Larsen & Toubro and ITI. The bench comprising Justice SH Kapadia and Justice Aftab said that employers are under no statutory obligation to collect supporting evidence and furnish them to tax authorities.
The court stated “the beneficiary of exemption U/s 10(5) is an individual employee. There is no circular of Central Board of Direct Taxes requiring the employer under Sec192 to collect and examine the supporting evidence to the declaration to be submitted by an employee”. However the concerned employee must retain such proofs to be presented before I-T Dept. when required.
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