SECTION 10(5) – PASSAGE MONEY AND LEAVE TRAVEL CONCESSION
53. Criteria for determining “home district” for the purpose of exemption under clause (5)
1. Section 10(5 ) provides that in the case of an individual being a citizen of India, travel concession or assistance received by or due to an individual from the employer for himself, his spouse and children in connection with his proceeding on leave or on retirement or on termination of service to his “home district” is exempt from income-tax, subject to fulfillment of the conditions laid down in the said section.
2. The words “home district” have not been defined either in the Income-tax Act, or the Income-tax Rules. A question has, therefore, been considered as to how to fix “home district” for the purpose of section 10(5). The following criteria are laid down for determining “home district” for the purpose of section 10(5):
i. the place declared by the assessee is one which requires his physical presence at intervals for discharging various domestic or social obligations and if so, after his entry into service, he had been visiting that place frequently; or
ii. the assessee owns residential property in the place or is a member of the joint family having such a property there; or
iii. his near relations are resident in that place; or
iv. prior to his entry into service, he had been living there for some years.
3. If any of the above conditions is satisfied, the assessee may be allowed to claim a particular place as his “home district”, once an assessee has exercised his option in respect of “home district”, he will not be ordinarily allowed to change the same.
Circular : No. 211 [F. No. 184/29/76-IT(A-I)], dated 26-2-1977
