MINISTRY OF FINANCE

(Department of Revenue)

(CENTRAL BOARD OF DIRECT TAXES)

NOTIFICATION

New Delhi, the 5th May, 2021

(INCOME-TAX)

G.S.R. 320(E).—In exercise of the powers conferred by clause (5) of section 10 read with section 295
of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct taxes hereby makes the following rules
further to amend the Income-tax Rules,1962, namely:─

1. Short title and commencement.- (1) These rules may be called the Income tax (15th Amendment),
Rules, 2021.

(2) They shall be deemed to have come into force from the 1st day of April, 2021.

2. In the Income-tax Rules, 1962, in rule 2B, after sub-rule (1), the following sub-rules shall be inserted,
namely:—

“(1A) For the assessment year beginning on the 1st day of April, 2021, where the individual referred to in
sub-rule (1) avails any cash allowance from his employer in lieu of any travel concession or assistance, the amount
exempted under the second proviso to clause (5) of section 10 shall be the amount, not exceeding thirty-six thousand
rupees per person, for the individual and the member of his family, or one-third of the specified expenditure,
whichever is less, subject to fulfilment of the following conditions, namely:-

(i) the individual has exercised an option to avail exemption under the second proviso of clause (5) of section
10, in lieu of the exemption under clause (5) of section 10 in respect of one unutilised journey during the
block of four calendar years commencing from the calendar year 2018;

(ii) the payment in respect of the specified expenditure is made by the individual or any member of his family to
a registered person during the specified period;

(iii) the payment in respect of the specified expenditure is made by an account payee cheque drawn on a bank or
account payee bank draft, or use of electronic clearing system through a bank account or through such other
electronic mode as prescribed under rule 6ABBA; and

(iv) the individual obtains a tax invoice in respect of specified expenditure from the registered person referred in
clause (ii).

Explanation 1- For the purpose of this sub-rule,-

(i) „tax invoice‟ means an invoice issued by the registered person under section 31 of the Central Goods and
Services Tax Act, 2017 (No. 12 of 2017);

(ii) „registered person‟ shall have the meaning assigned to it in clause (94) of section 2 of the Central Goods and
Services Tax Act, 2017 (No. 12 of 2017);

(iii) „specified expenditure‟ means expenditure incurred by an individual or a member of his family during
specified period on goods or services, which are liable to tax at an aggregate rate of twelve per cent. or above
under various Goods and Services Tax (GST) laws and goods are purchased or services procured from GST
registered vendors or service providers;

(iv) „specified period‟ means the period commencing from the 12th day of October, 2020 and ending on the
31stday of March, 2021.
4 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)]

Explanation 2 For the removal of doubt, it is hereby clarified that if the amount received by or due to an individual,
as per the terms of his employment, from his employer in relation to himself and member of his
family, in connection with the specified expenditure is in excess of the thirty six thousand rupees per
person, for the individual and the member of his family, the exemption under this sub-rule would be
restricted to thirty-six thousand rupees per person, for the individual and the member of his family, or
one-third of the specified expenditure, whichever is less.

Explanation 3 It is hereby clarified that the clarification issued by the Department of Expenditure, Ministry of
Finance, vide OM F. No 12(2)/2020-EII (A) Dated 12th October, 2020 and any subsequent
clarifications, if any, issued in this regard shall apply mutatis mutandis to the exemption under this
sub-rule.

(1B) Where an exemption under the second proviso to clause (5) of section 10 is claimed and allowed, sub-rule
(2) shall have effect as if for the words „two journeys‟ , the words „one journey‟ has been substituted.”.

[Notification No. 50/2021/F. No.370142/14/2021-TPL]

KAMLESH CHANDRA VARSHNEY, Jt. Secy. (Tax Policy and Legislation)

Explanatory Memorandum: It is hereby certified that no person is being adversely affected by giving retrospective
effect to these rules.

Note: The principal rules were published in the Gazette of India, Extraordinary, Part-II, Section-3, Sub-section (ii)
vide number S.O. 969 (E), dated the 26th March, 1962 and last amended vide notification number G.S.R.
318(E) dated 4th May, 2021.

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