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TMI Blog2009 (1) TMI 396X X X X Extracts X X X X X X X X Extracts X X X X ..... e treated as a perquisite (salary) and, therefore, the assessee cannot be treated as a defaulter under section 201(1) of the Act and consequently no interest under section 201 (IA) of the Act can be levied? – Held that stock options are not perquisites granted by assessee – hence assessee is not liable to deduct tax on value of shares issued to employees - 44 of 2003 - - - Dated:- 29-1-2009 - D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... correct in holding that the assessee-company was not liable to deduct TDS under section 192 of the Act over the issue of its shares under stock option plan to its employees at a concessional rate as it cannot be treated as a perquisite (salary) and, therefore, the assessee cannot be treated as a defaulter under section 201(1) of the Act and consequently no interest under section 201 (IA) of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in favour of the assessee and against the appellant/Revenue, which is reproduced hereunder (page 175): "Be that as it may, proceeding on the basis that there was a 'benefit', the question is whether every benefit received by the person is taxable as income. In our view, it is not so. Unless the benefit is made taxable, it cannot be regarded as income. During the relevant assessment years, ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat if the shares allotted to the employee had no realizable sale value on the day when he exercised his option then there was no cash inflow to the employee. It was not possible for the employee to know the future value of the shares allotted to him on the day he exercised his option. Even the cost of acquisition as 'nil' came to be introduced in the 1961 Act by the Finance Act, 1999, only with e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of the buy-back problems, which were genuine problems in cases where the employees stood dismissed, removed or in the case of resignation in which cases they were required to return the allotment." 5. In this view of the matter, it is no more necessary for us to answer the said questions of law as the same have already been answered in the aforesaid decision of the Supreme Court. 6. The app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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