High Court Of Madhya Pradesh : Full Bench
All India Punjab National Bank Officers’ Association & Anr. vs. Union Of India & Ors.
Section 17(2)(ii); Rule 3
A.K. Patnaik, C.J.; Dipak Misra & K.K. Lahoti, JJ.
Misc. Petn. No. 929 of 1994
10th July, 2007
ORDER
BY THE COURT :
This petition was referred to the Full Bench by order dt. 7th Nov., 2005 of the learned single Judge as it was contended before the learned single Judge that a similar matter in Writ Petn. No. 1285 of 2002 had been referred to the Full Bench. In Writ Petn. No. 1285 of 2002, r. 3 of the IT Rules as amended by the IT (22nd Amendment) Rules, 2001, had been challenged as ultra vires s. 17(2) of the IT Act and Art. 14 of the Constitution. We have disposed of Writ Petn. No. 1285 of 2002 today by a separate order [reported as All India State Bank of Indore Officers’ Co-ordination Committee & Anr. vs. CBDT (2007) 212 CTR (MP)(FB) 338—Ed.] in terms of the judgment Arun Kumar & Ors. vs. Union of India & Ors. (2006) 205 CTR (SC) 193 : (2006) 286 ITR 89 (SC) in which the Supreme Court, while upholding the validity of r. 3 as amended, has held that r. 3 as amended is in the nature of a machinery provision and applies only to the cases of concession in the matter of rent respecting any accommodation provided by an employer to his employees and it will be therefore open to the assessee to contend that there is no concession in the matter of accommodation provided by the employer to the employees and the case is not covered by s. 17(2)(ii) of the IT Act. When the matter was taken up for hearing today, Mr. Sumit Nema, learned counsel for the petitioners submitted that in this writ petition, r. 3, as amended by the IT (22nd Amendment) Rules, 2001, does not apply as the case relates to a period prior to 2001, but in Arun Kumar & Ors. vs. Union of India & Ors. (supra), the Supreme Court has taken a view that even before the amendment to r. 3 brought by the IT (22nd Amendment) Rules, 2001, s. 17(2)(ii) of the IT Act was not to apply if it is established that there was no concession in the matter of accommodation provided by the employer to the employees and thus it was open for the assessee to contend that there is no concession in the matter of accommodation provided to the employees and the case is not covered by s. 17(2)(ii) of the Act.
In view of the aforesaid law explained by the Supreme Court in Arun Kumar & Ors. vs. Union of India & Ors. (supra) we dispose of this petition with a direction that it will be open for the petitioners to contend that there is no concession in the matter of accommodation provided by the employer to the employees and the case is not covered by s. 17(2)(ii) of the Act.
[Citation : 296 ITR 108]
