In majority of private companies, LTC or LTA is a component of remuneration. The gross amount agreed with the employee would be divided in to basic salary, HRA, other allowances, LTA etc and in such cases the LTA becomes payable as a taxable allowance. But in public sector and government services, LTA or LTC, as the case may be, is a concession or allowance which is paid over and above salary. In such cases, obviously, a resigned employee who has not completed the prescribed service, say 12 months, will not be eligible for LTA. But when it comes to a situation where the LTA is a component of salary or remuneration (often described as CTC by new gen HRs) I feel it should be paid as an allowance if he does not undertake the tour.