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Lta - travel by air india

tpj1w (DH) (30 Points)

19 February 2013

Is it true that travel by national carrier i.e. Air India has been made mandatory for claiming non taxable LTA from 2012? There is a mention of circular dated 5-October 2012.

Can someone please clarify and also help with the logic behind this?

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6 Replies

Dipjyoti Majumdar (CA in service & CS. dipmaj@ rediffmail.com ) (3468 Points)
Replied 19 February 2013

Yes, the words used in section 10(5) and Rule 2B governing LTA exemption are "national carrier". It is strange that why lawmakers do not change the provisions. If an employee travels by Indigo, will he not be entitled to exemption ?

Also you see, the block period consisiting of calendar years should be changed to FYs to avoid all sorts of calculations.

Regards,

tpj1w (DH) (30 Points)
Replied 20 February 2013

My contention is the circular reads

Under Exemption Limit - Air economy fare of the national carrier (Air India) by shortest route to the place of destination

However it no where states that the travel itself has to be by national carrier? Any different thoughts??

Dipjyoti Majumdar (CA in service & CS. dipmaj@ rediffmail.com ) (3468 Points)
Replied 20 February 2013

Yes, Mr./ Ms DH or tpj1w (whoever you are). Your observation is correct. If an employee flies in any other company like Indigo or otherwise, for LTA exemption calculation the fare charged by Air India will be compared with that of other airlines and the lowest will be allowed as exemption.

Thanks for your observation.

Regards,

Dipjyoti Majumdar (CA in service & CS. dipmaj@ rediffmail.com ) (3468 Points)
Replied 20 February 2013

Mr./ Ms DH or tpj1w

Another question cropped up in my mind. If an employee flies to a place where there is no Air India flight, then how to compare the air fare actually expended on non national carrier flight and avail LTA exemption.

Regards,