THE INCOME-TAX ACT, 1961

CHAPTER IV

COMPUTATION OF TOTAL INCOME

Heads of income

A. Salaries

Deductions from salaries.

16. The income chargeable under the head "Salaries" shall be computed after making the following deductions, namely :

(i) any amount not exceeding five hundred rupees, expended by the assessee on the purchase of books and other publications necessary for the purpose of his duties ;

(ii) in respect of any allowance in the nature of an entertainment allowance specifically granted to the assessee by his employer

(a) in the case of an assessee who is in receipt of a salary from the Government, a sum equal to one-fifth of his salary (exclusive of any allowance, benefit or other perquisite) or five thousand rupees, whichever is less ; and

(b) in the case of any other assessee who is in receipt of such entertainment allowance and has been continuously in receipt of such entertainment allowance regularly from his present employer from a date before the 1st day of April, 1955, the amount of such entertainment allowance regularly received by the assessee from his present employer in any previous year ending before the 1st day of April, 1955, or a sum equal to one-fifth of his salary (exclusive of any allowance, benefit or other perquisite) or seven thousand five hundred rupees, whichever is the least ;

(iii) any amount paid by the assessee in respect of taxes on professions, trades, callings or employments levied under any State or Provincial Act;

(iv) where the assessee is not in receipt of a conveyance allowance, whether as such or as part of his salary, in respect of expenditure on travelling for the purposes of his employment, a sum calculated in respect of each calendar month or part thereof comprised in the period of his employment during the previous year, on the basis provided hereunder, namely :

(a) where the assessee owns a motor car which is used for the purposes of his employment ...	Rs. 200 ;
(b) where the assessee owns a motor cycle, scooter or other moped which is used for the purposes of his employment ...	^1[Rs. 75 ;
(c) in any other case ...	Rs. 50;]

(v) any amount actually expended by the assessee, not being an amount expended on the purchase of books or other publications, or on entertainment or on the maintenance of a conveyance, which, by the conditions of his service, he is required to spend out of his remuneration wholly, necessarily and exclusively in the performance of his duties.

1. Substituted by Finance (No. 2) Act, 1971, w.e.f. 1-4-1972.