Dear Friends,
I have one more doubt to discuss.
An employer rejects it's employee's claim papers on LTA who opted exemption for that financial year and deducted TDS on the claim to be settled only for the reason that the bill/receipt paid for such travel does not bear service tax registration no. of the travel agency to whom he undergone travel.
Is his (Employer's) contention right?
What my opinion is, the contention taken by the employer is not justified because:-
(1) Travel Agencies whose gross receipts does not exceed Rs.8.00 Lakhs per annum
need not pay service tax, hence registration under service tax is at the option
of the travel agency;
(2) It is not the duty and responsibility of the employee to investigate whether the
travel agency is required to register under service tax;
(3) An employee cannot be compelled to plan his travel with a travel agency who have
registered under service tax;
(4) If the travel agency do not register with service tax eventhough they are required
to do so, the risk lies not on the part of the employee, but on the travel agency
who had defaulted.
Considering the above, an employee cannot be deducted TDS against his claim on LTA.
Kindly provide your valuable suggestions and feed back and if there is any case law
for this issue, kindly send to my e-mail ID: jeyen110 @ sancharnet.in
Regards
S.Jeyendran
CAclubindia
