Chandan, a handicapped employee receives ₹1,500 per month as transport allowance from his employer. His actual expenditure on transport is ₹1,000 per month. The amount of transport allowance taxable under the head income

Correct answer: (B) Nil. Under the historical rule, qualifying disabled employees had transport allowance exemption up to 1,600 monthly. Receipt of 1,500 monthly is fully exempt. This answer applies to the historical law and assessment-year context of this December 2014 paper; later amendments may differ.