Income Tax Act, 1961
Section 2: Subs. by Act 32 of 1985, s. 6, for certain words (w.e.f. 11986).
2. Subs. by Act 32 of 1985, s. 6, for certain words (w.e.f. 11986).
3. Subs. by Act 14 of 2001, s. 13, for “twenty-four thousands rupees” (w.e.f. 12002).
4. The proviso omitted by Act 22 of 2007, s. 11 (w.e.f. 12008). Earlier the proviso inserted by Act 10 of 2000, s. 11
(w.e.f. 12001).
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1[Explanation.—For the removal of doubts, it is hereby declared that the use of any vehicle
provided by a company or an employer for journey by the assessee from his residence to his
office or other place of work, or from such office or place to his residence, shall not be regarded
as a benefit or amenity granted or provided to him free of cost or at concessional rate for the
purposes of this sub-clause;]
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;
(v) any sum payable by the employer, whether directly or through a fund, other than a
recognised provident fund or an approved superannuation fund 3[or a Deposit-linked Insurance
Fund established under section 3G of the Coal Mines Provident Fund and Miscellaneous
Provisions Act, 1948 (46 of 1948), or, as the case may be, section 6C of the Employees’
Provident Funds and Miscellaneous Provisions Act, 1952 (19 of 1952)], to effect an assurance on
the life of the assessee or to effect a contract for an 4[annuity;]
5[(vi) the value of any specified security or sweat equity shares allotted or transferred, directly
or indirectly, by the employer, or former employer, free of cost or at concessional rate to the
assessee.
Explanation.—For the purposes of this sub-clause,—
(a) “specified security” means the securities as defined in clause (h) of section 2 of the
Securities Contracts (Regulation) Act, 1956 (42 of 1956) and, where employees’ stock option
has been granted under any plan or scheme therefor, includes the securities offered under
such plan or scheme;
(b) “sweat equity shares” means equity shares issued by a company to its employees or
directors at a discount or for consideration other than cash for providing know-how or
making available rights in the nature of intellectual property rights or value additions, by
whatever name called;
(c) the value of any specified security or sweat equity shares shall be the fair market
value of the specified security or sweat equity shares, as the case may be, on the date on
which the option is exercised by the assessee as reduced by the amount actually paid by, or
recovered from, the assessee in respect of such security or shares;
(d) “fair market value” means the value determined in accordance with the method as
may be prescribed;
(e) “option” means a right but not an obligation granted to an employee to apply for the
specified security or sweat equity shares at a predetermined price;
(vii) the amount of any contribution to an approved superannuation fund by the employer in
respect of the assessee, to the extent it exceeds 6[one lakh rupees]; and
(viii) the value of any other fringe benefit or amenity as may be prescribed:]
any sum paid by the employer in respect of any obligation which, but for such payment,
would have been payable by the assessee;
any sum payable by the employer, whether directly or through a fund, other than a
recognised provident fund or an approved superannuation fund 3[or a Deposit-linked Insurance
Fund established under section 3G of the Coal Mines Provident Fund and Miscellaneous
Provisions Act, 1948 (46 of 1948), or, as the case may be, section 6C of the Employees’
Provident Funds and Miscellaneous Provisions Act, 1952 (19 of 1952)], to effect an assurance on
the life of the assessee or to effect a contract for an 4[annuity;]
5[
the value of any specified security or sweat equity shares allotted or transferred, directly
or indirectly, by the employer, or former employer, free of cost or at concessional rate to the
assessee.
Explanation.—For the purposes of this sub-clause,—
“specified security” means the securities as defined in clause
of section 2 of the
Securities Contracts
Act, 1956 (42 of 1956) and, where employees’ stock option
has been granted under any plan or scheme therefor, includes the securities offered under
such plan or scheme;
“sweat equity shares” means equity shares issued by a company to its employees or
directors at a discount or for consideration other than cash for providing know-how or
making available rights in the nature of intellectual property rights or value additions, by
whatever name called;
the value of any specified security or sweat equity shares shall be the fair market
value of the specified security or sweat equity shares, as the case may be, on the date on
which the option is exercised by the assessee as reduced by the amount actually paid by, or
recovered from, the assessee in respect of such security or shares;
“fair market value” means the value determined in accordance with the method as
may be prescribed;
“option” means a right but not an obligation granted to an employee to apply for the
specified security or sweat equity shares at a predetermined price;
the amount of any contribution to an approved superannuation fund by the employer in
respect of the assessee, to the extent it exceeds 6[one lakh rupees]; and
the value of any other fringe benefit or amenity as may be prescribed:]