TMI Blog2010 (10) TMI 1126X X X X Extracts X X X X X X X X Extracts X X X X ..... ployees, the assessee had not deducted tax on the perquisite value of the accommodation provided to the employees as according to the assessee, no concession in the matter of accommodation within the meaning of Section 17(2)(ii) was given to the employees. HELD THAT:- The Apex Court in Arun Kumar's case[ 2006 (9) TMI 115 - SUPREME COURT] while upholding the validity of Rule 3 has held that in the absence of any deeming fiction in the Act, it is open to the assessee to contend that there is no concession in the matter of accommodation provided by the employer to the employees and the case is not covered by Section 17(2)(ii) of the Act. Even after the substitution of Rule 3 with effect from 1/4/2001, in the absence of any specifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 201 of the Act does not suffer from any infirmity. Decided in favour of assessee. - J.P.DEVADHAR AND A.B. CHAUDHARI, JJ. Shri Anand Parchure, Advocate for the appellant. S/Shri N.S. and S.N. Bhattad, Advocates for the respondent. ORAL JUDGMENT (PER J.P. DEVADHAR, J.) : Heard Shri Parchure, learned Counsel for the appellant, and Shri Bhattad, learned Counsel for the respondent. 2) The basic question raised in all these appeals is whether the Income Tax Appellate Tribunal was justified in setting aside the orders passed by the Assessing Officer under Section 201 of the Income Tax Act, 1961 (for short, the Act ) ? The Assessing Officer in his orders passed under Section 201 of the Act had held that the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (SC)} and in the light of the retrospective amendment to Section 17(2)(ii) of the Act by the Finance Act, 2007, the Assessing Officer called upon the assessee to deduct and pay tax on the concessional accommodation provided to its employees from financial year 2001-02. 6) The assessee objected to the action initiated by the Assessing Officer, inter alia, on the ground that firstly, there was no concession in the matter of rent and hence, Rule 3 of the Income Tax Rules, 1962 had no application in the present case. Secondly, assuming that there was any tax liability on the employees as a result of the retrospective amendment to Section 17(2) by the Finance Act, 2007, the employer assessee could not be declared as assessee in default for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was obliged to deduct tax at source and failure to do so made the assessee liable for consequences set out under Section 201 of the Act. 11) We see no merit in the above contentions. The Apex Court in Arun Kumar's case (supra) while upholding the validity of Rule 3 has held that in the absence of any deeming fiction in the Act, it is open to the assessee to contend that there is no concession in the matter of accommodation provided by the employer to the employees and the case is not covered by Section 17(2)(ii) of the Act. In other words, even after the substitution of Rule 3 with effect from 1/4/2001, in the absence of any specific provision under the Act, it was open to the assessee not to deduct tax at source relating to the ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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