Fixed conveyance allowance flowing out of a wage settlement should be treated as wages for all purposes w.e.f 01.04.2002.
However, the following should not be treated as wages u/s 2(22) of E.S.I Act and also for the purpose of
deciding the coverage of an employee under section 2(9) of the Act :
a)Amount towards conveyance paid or reimbursed to any employee for incurring expenses for specific duty related journey.
b)Reimbursement of actual cost of conveyance for coming to work and going from work on production of ticket or season ticket to proof actual expenditure.
c)Payment of certain amount for maintenance of vehicle depending upon cadre of the Official and category of the vehicle and subject to production of records for actually marinating the vehicles.
d)Fixed conveyance allowance paid at an interval exceeding two months, unless such payment is made as per contract of service or agreement.
Payment of conveyance allowance at a uniform basis regardless of whether the employee concerned has or has not incurred any expenditure on his journey to the place of his work and back home is part of “wages” (Karnataka High Court in the case of M/s Rajashree Cement and others v. ESIC 2004 LIC.2244;2004(102) FLR.836)
Regards,
Suresh