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2013 (9) TMI 307 - AT - Income TaxIncome from salary - TDS u/s 192 - Perquisite value of the residential accommodation - ownership of accommodation - Section 17(2)- Whether License fee determined under the Punjab Civil Service Rule shall only be taken as taxable perquisite under Rule 3(1) of the Income-tax Rules - Assessee in default u/s 201 - Held that:- accommodations provided by the BBMB to the State Government employees were the properties owned by the Government of Punjab and the other States. Admittedly, the said properties were not owned by BBMB and in terms of section 79 of Punjab Reorganization Act, 1966, the residential accommodation established for the employees of the Beas Project was the work pertaining to Bhakra Project, which was owned by Punjab Government and later by partner States. Consequently we find no merit in the order of the Assessing Officer in treating the residential accommodation provided to the employees by BBMB as owned by BBMB. Since the accommodation to the employees of BBMB had been provided by the respective State Governments, and where the Government of Punjab was the owner of the land originally allotted to the Bhakra Project and since BBMB was functioning under the direct control of the Central Government, wherein the employees of BBMB were to be treated as the employees of the Central or State Government, the ingredients of Sr.No.1 of Table-1 under Rule 3 of the Income-tax Rules stand fulfilled. The said provisions relates to the accommodation provided by the Central Government or any State Government to its employees or employees serving with any body or undertaking under the control of such Government on deputation. The employees employed with BBMB were the employees of the State Government, which in turn was functioning under the control of Central Government and consequently the perquisite value of the rent free accommodation provided to such employees was to be the licence fees determined by the State Government as reduced by the rent actually paid by the employees. Admittedly in the facts of the present case the licence value had been determined in accordance with Rule 5.23 of Punjab Civil Service Rules, Vol. I, Part-I and had been included as taxable perquisite under Rule 3(1) of the Income-tax Rules, in the case of the assessee - The accommodation in the present case provided to the employees of BBMB was owned by the respective States and was not owned by BBMB and since the basic condition of ownership of the accommodation has not been specified in the present case, nor the premises had been taken on lease by the BBMB from the respective States, the provisions of Rule 3(1) of the Income-tax Rules is not applicable - Decided against Revenue.
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