Hi Rabi,
You will create a transport allowance wage type from model wage type M220. Insert this wage type in the Allowance Grouping and assign tax code SCNV(where tax type will be rule based, Frequency Monthly & Exempt Limit is 1600(as per new slabs)).
Now at the time of payroll run , in the payroll schema function INCC0 will executing for calculation exempted limit for the current month and projected value for rest of the financial year.
Regards, Sankarsan