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TMI Blog1982 (3) TMI 99X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of house. Thus, the assessee enjoyed a concession which is to be treated as a perquisite. Thus, the ITO added 5 1/2 per cent interest as perquisite which came to Rs. 1,727. In appeal, the AAC held that as per section 17(2)(iii) of the Income-tax Act, 1961, perquisite includes value of any concession or amenity granted or provided free of cost or at concessional rate by any employer to an employee whose income under the head "Salaries", exclusive of the value of all benefits or amenities not provided for by way of monetary payment exceeds eighteen thousand rupees. The LIC advances loans to the employees at a concessional rate of 5 per cent whereas it charges an interest of 10 1/2 per cent from the customers. Therefore, the extent of conc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterest in the company ; (c) by any employer (including a company to an employee to whom the provisions of paragraphs (a) and (b) of this sub-clause do not apply and whose income under the head 'Salaries', exclusive of the value of all benefits or amenities not provided for by way of monetary payment, exceeds eighteen thousand rupees." The assessee comes under item (c). The assessee has been provided the loan at a concessional rate. The question is whether that could be treated as a perquisite. An identical question came up for consideration before the Madras High Court in Addl. CIT v. Late A.K. Lakshmi. The question whether the non-liability to pay interest would be a benefit and whether what has been determined is the cost of that ben ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es is to be calculated. In the authors' opinion, such loan must be a 'benefit' in the ordinary meaning of that word." It was held by the Madras High Court in the above case that the interest that was chargeable during the relevant years, which has been fixed at 10 per cent, is a benefit that had accrued to the assessee without cost, attracting the definition of the term "perquisite" under section 17(2) and failing under section 17(2)(iii)(a). The above ratio squarely applies to the instant case. 4. An identical question had come up for consideration before this bench of the Tribunal in IT Appeal No. 234 (Bang.) of 1980. The Tribunal, by its order dated 29-7-1981, held that the interest-free loan granted by the employer to its employee i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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