22 December 2011
For HRA the requisite condition is Rent expenditure incurred. Rent Paid or Payable both are alike when mercantile system of accounting is being followed. . A salaried employee also follows mercantile system. Salary is taken on the due basis as a policy matter. When due salary has not been received by the employee, it still remains taxable in his hand. . In my view, the criteria of incurring the expenditure is more relevant and "incurring" includes both paid and payable.
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