Perquisite valuation for rent-free accommodation follows standard rent under the U.P. rent law, not a new factual valuation plea.

The value of a rent-free residential accommodation perquisite was held to be determined by reference to the standard rent fixed for similar accommodation under the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, rather than by a different valuation basis under rule 3 of the Income-tax Rules, 1962. An earlier decision was treated as settling the valuation principle, and the Revenue could not introduce a fresh factual plea at the reference stage that had not been raised before the Tribunal. The perquisite value was therefore limited to the standard rent basis.

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Issues: Whether the value of the perquisite in respect of rent-free residential accommodation provided by the employer was to be determined on the basis of the standard rent fixed under the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, or under rule 3 of the Income-tax Rules, 1962.

Analysis: The question was treated as concluded by an earlier decision holding that, for valuation of the accommodation perquisite, the relevant basis is the standard rent fixed by the Rent Controller for similar accommodation under the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972. The Revenue was not permitted to raise a new factual plea at the reference stage that had not been urged before the Tribunal.

Conclusion: The value of the accommodation perquisite was correctly limited to the standard rent fixed under the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972, and the question was answered in favour of the assessee.

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