IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN FRIDAY, THE 23RD DAY OF DECEMBER 2011/2ND POUSHA 1933 WA.No. 2049 of 2006 (E) ======================= AGAINST THE ORDER/JUDGMENT IN WPC.23735/2006 DATED 03-10-2006 APPELLANT(S)/PETITIONER ======================= 1 KAYAMKULAM N.T.P.C.EMPLOYEES UNION (A TRADE UNION REGD. WITH REGISTRATION NO.03-03 OF 1999) N.T.P.C., KAYAMKULAM P.O.CHOOLATHERUVU ALLEPPEY DISTRICT ACTING THROUGH ITS PRESIDENT T.HARIDASAN NAIR. BY ADV.SRI.S.VIJAYAN NAIR RESPONDENT(S) / RESPONDENTS ============= 1 N.T.P.C.LIMITED, (FORMERLY NATIONAL THERMAL POWER CORPORATION LTD.) A GOVT. OF INDIA ENTERPRISES HAVING ITS REGD. OFFICE AT NTPC BHAVAN SCOPE COMPLEX, LODHI ROAD NEW DELHI THROUGH ITS MANAGING PARTNER (DIRECTOR). 2 UNION OF INDIA, MINISTRY OF FINANCE, DEPARTMENT OF REVENUE CENTRAL BOARD OF DIRECTOR TAXES NORTH BLOCK, NEW DELHI. BY ADV. SRI.B.S.KRISHNAN (SR.) SMT.LATHA KRISHNAN SRI.K.ANAND (A.201) SRI.P.K.R.MENON,SR.COUNSEL,GOI(TAXES) MR.BOBBY JOHN, GOVERNMENT PLEADER THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 23-12-2011 , ALONG WITH WPC. 2334/2007, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.N.RAMACHANDRAN NAIR & K.VINOD CHANDRAN, JJ. .................................................................... W.A. No.2049 of 2006 & WP(C) No.2334 of 2007 .................................................................... Dated this the 23rd day of December, 2011. J U D G M E N T Ramachandran Nair, J. Appellant in the Writ Appeal and the petitioner in the Writ Petition are employees unions which have approached this Court for a direction to the employer not to deduct tax on the value of perquisites in respect of accommodation provided at concessional rate of rent to the employees. The learned Single Judge, who decided the Writ Petition against which the Writ Appeal is filed, felt that the matter should be considered by the Income Tax Authorities and not by this Court in writ proceedings. 2. On considering the grounds raised in the Writ Appeal and in the WP(C), we do not find any justification to take a different view because tax has to be deducted at source on the salary payments including perquisites as required under Section 192 of the Income Tax Act. If the deduction W.A.No.2049/06 & WP(C) No.2334/07 2 proposed is excess, it is always open to the employees to approach the Assessing Officer to issue a certificate under Section 197 for payment without deduction or deduction after excluding any amount which is not taxable, and if such application is filed, it is for the Assessing Officer to consider and pass orders, which will bind on the employer deducting tax. The issue raised is apparently covered by a decision of the Supreme Court in Arun Kumar and Others v. Union of India and Others, reported in 286 ITR 89, where the Supreme Court has considered validity of the amendment to the Income Tax Rules, i.e. on valuation of perquisites pertaining to rent free accommodation, accommodation at concessional rent etc. provided by the employer. 3. Accordingly, we dispose of both the Writ Appeal and the Writ Petition leaving it open to the employees concerned or the Union in a representative capacity to approach the Assessing Officer for issuing orders under Section 197 of the Income Tax Act after considering the case on merits. W.A.No.2049/06 & WP(C) No.2334/07 3 4. We make it clear that since stay was granted by this Court, the Assessing Officer will be free to demand tax without reference to period of limitation if it is otherwise payable either from the employers under Section 201(1) or from the employees-assessees, by making assessments against them. Both the Writ Appeal and the Writ Petition are disposed of as above. (C.N.RAMACHANDRAN NAIR, JUDGE) (K.VINOD CHANDRAN, JUDGE) jg