1996 (11) TMI 49

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.... boarding and lodging expenses met by the employer were granted to meet the expenses wholly, necessarily and exclusively incurred in the performance of the duties and the same was not taxable under the provisions of section 10(14) of the Income-tax Act, 1961 ? " The above question comprehends three assessees, Dutch nationals, deputed to work in India at the relevant time on the ship named "Jagsevak". During their stay in India, their employer had met their boarding and lodging expenses directly as indicated below : " 1. Mr. Vander C. C. Malen Rs. 200 per day x 96 Rs. 19,200 2. Mr. L. E. Martens Rs. 200 per day x 53 Rs. 10,600 3. Mr. Stock Leender Rs. 200 per day x 67 Rs. 13,400. " The Income-tax Officer, with reference to the....

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..... None appears for the assessees. "Perquisite" is defined by section 17(2) of the Income-tax Act inclusively, inter alia, as meaning : " (2)(iv) any sum paid by the employer in respect of any obligation which, but for such payment, would have been payable by the assessee. " The case of the Department is that since the facility enjoyed by the assessees is a perquisite within the meaning of section 17(2)(iv), the same is not liable to be exempted under section 10(14), which reads as follows : " (14) any special allowance or benefit, not being in the nature of an entertainment allowance or other perquisite within the meaning of clause (2) of section 17, specifically granted to meet expenses wholly, necessarily and exclusively incur....