Hi Anil,
I presume you are speaking about income being tax-free for the employee.
Firstly, "allowances" cannot be tax-free; you would need to have only "reimbursements" which are tax-free. You could have petrol reimbursements wherein you will need to pay the employee on the receipt of bills. You can also have the following: Books and Periodicals Reimbursement, Medical Reimbursement, Driver Salary Reimbursement.
One thing that you will have to check would be if these reimbursements would result in the employer paying Fringe Benefits Tax.
Hope this helps you.
Chanchal