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of <h1>Tribunal: Stock Options vs. Stock Appreciation Rights</h1> <h3>Shri Anil Kumar Nehru, Mumbai Versus Dy. Commissioner of Income Tax, Circle 16 (2), Mumbai</h3> Shri Anil Kumar Nehru, Mumbai Versus Dy. Commissioner of Income Tax, Circle 16 (2), Mumbai - TMI Issues involved: Interpretation of stock options as stock appreciation rights, employer-employee relationship for tax assessment, applicability of legal precedents, taxability of stock options as capital gains, validity of Tribunal's order.Interpretation of stock options: The Tribunal considered the stock options granted to the appellant as akin to stock appreciation rights, similar to the case of Sumit Bhattacharya v/s. ACIT. The Tribunal's decision was based on this interpretation, which is subject to appeal before the Bombay High Court.Employer-employee relationship: The Tribunal determined the existence of an employer-employee relationship between PUSA and the appellant, leading to the assessment of benefits from stock options as perquisites under Section 17(2)(iii) of the Act.Applicability of legal precedents: The Tribunal's decision regarding the applicability of the principles established in CIT v/s. Infosys Technologies Limited was questioned. The appellant argued that the Tribunal misdirected itself by holding that the Infosys case was distinguishable and not relevant to their situation.Taxability of stock options: The Tribunal concluded that the appellant did not acquire any capital asset upon receiving the stock options, leading to the impugned sum not being exigible to tax as capital gains. This decision raised the issue of whether the stock options should be taxed differently.Validity of Tribunal's order: The appellant challenged the Tribunal's order dated 19-11-2010, alleging that it was perverse, contrary to the weight of evidence, and founded on irrelevant considerations. The appellant contended that the Tribunal's conclusions were vitiated and plagued by infirmities, questioning the judicial reasoning behind the Tribunal's inferences.This summary provides a detailed breakdown of the issues involved in the judgment, highlighting the key legal aspects and arguments presented by the parties involved.
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