2009 (12) TMI 581

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....llant contends that it has not committed any default in the matter of deduction of tax at source out of the salaries paid to its employees. 3. The appellant contends that there is no concessional rental perquisite u/s 17(2)(ii) of the Income-tax Act, 1961 and therefore the bank is not liable for deduction of tax at source in respect of any such alleged perquisite provided to its employees. The learned CIT(A) erred in upholding the order of the DCIT(TDS). 4.  It is contended that the bank has shown no concession in the matter of providing leased accommodation to its employees and it has deducted standard rent from the salaries of employees to whom the accommodation has been provided by the appellant. Consequently, there is no conc....

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....thout prejudice it is further contended that the quantification of short fall in tax at the flat rate of 30% at Rs.1,54,892 (for assessment year 2004-05; Rs.1,47,572 for assessment year 2005-06; Rs.5,35,038 for assessment year 2006-07 and Rs.5,65,772 for assessment year 2007-08) is erroneous, arbitrary and untenable." 3. The learned counsel for the assessee submitted that assessee is a public sector undertaking and it has received the COD approval and has filed copy thereof before us. 3. The learned counsel for the assessee submitted that the standard rent for all the employees of the assessee bank were fixed on all India basis and during the relevant period, there was no law to deduct tax at source on the perquisite value of the resi....

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....rom 1.4.2002, whereby the value of the residential accommodation provided by the assessee-bank to its employees by recovering lesser amount of rent than the lease rent paid to the lessor of the premises, amounts to perquisite and the employer is made liable to deduct tax on the perquisite value thereof. However, we find that at the relevant time, when the TDS was to be effected by the assessee-bank, there was no such provision on the statute book and the law was amended at a later date in 2007, with retrospective effect from 1.4.2002. We find that the issue whether in the facts of the case, the assessee could be held to be in default for non-deduction of tax at source on the perquisite value of the residential accommodation provided at a le....