Querist : Anonymous (Querist) 21 May 2011

Respected Experts

I want to know that whether incentive bonus received by LIC Devlopment Officer will be allowed to deduction of 30% of 40% deduction??

This incentive bonus is generally received due to the good work done by them and for such work they are frequntly arranging the training and awareness programms for agents and for clients as well so this include huge cost so can it be claimed as deduction?(as far as i know it is allowed flat at the max 30%)

Further can LIC D.O. claim depreciation on car used for the LIC business and also car insurance premium??

Actually they are receiving the salary however his duty is to train agents and many time to go wid the agents for any calls or many times they need to use the vehicles for the various claims. so can they claim depr and ins of car?

Plese help me....
Waiting for your reply.

Thanks in advance.

22 May 2011

Any sum received from the employer is treated as Salary Income. Development Officers are not carrying on any business and as such are not eligible to claim Depreciation on Car. However additional conveyance expenses which is based on business solicited by the D.O., subject to the certification by the LIC can be claimed as an expenditure.

Please follow the link for more details - /sc/view.php?case=30202

Querist : Anonymous (Querist) 23 May 2011

Respected Paras sir,

Firstly many many thanks to guide me.

But still as i have confusion so m asking for the same point discussed above.

It is 100% right that development officer is receiving is salary only.

But in few case what i seen that revenue has disallowance the 30%incentive bonus but in that case assessee goes in appeal and in subsequant cases the appeal is favouring the assessee and against of the revanue.

I.e allowing 30% incentive bonus, allowing car depreciation even car insurance premium also.

Than can i take the base of the appeal and again claimed the such exp?

Will the base of appeal can be taken for other devlopment officer also??

Further let me tell u that in almost all case devlopment office purchase car only with the LIC loan so it is cristal clear that they are genuinly using the car to increase the business.....

The appeal is granted by commissioner only

Please guide me.

Querist : Anonymous (Querist) 24 May 2011

CIT Vs. Kiranbhai H. Shelat [1999] 235 ITR 635 (Guj).

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