(1.) IN all these writ petitions, a common question arises for consideration. Hence they are taken up together for hearing.
(2.) O . P. No. 10569 of 2003 and O. P. No. 8425 of 2002 were taken as the leading cases for argument. In O. P. No. 10569 of 2002, the petitioners are officers of the third respondent scheduled bank. The respondents are (1) Union of India, (2) the Central Board of Direct Taxes and (3) the Federal Bank.
(3.) THERE are no detailed factual averments in the writ petitions supporting the contentions that the provisions are in any way arbitrary or illegal. However, among the grounds urged, it is averred that the amendment to rule 3 is arbitrary since it seeks to discriminate between Central/State Government employees on the one hand and the public sector and private sector employees on the other and that the same is without any reasonable classification and having no nexus with the object sought to be achieved. It is also averred that accommodation taken on lease and provided to employee is not a perquisite and reimbursement towards motor car allowance cannot be treated as a perquisite as what is provided by way of motor car allowance is only a facility for reimbursement of petrol/diesel charges and is meant for journeys of officers from residence to office and back. It is also averred that the fringe benefit does not include interest subsidy and is not perquisite. Therefore, taxing interest subsidy and reimbursement of conveyance allowance is opposed to section 17(2) of the Act. It is the further case that the petitioners are eligible to avail of various loans such as house building loans, vehicle loan, etc., at a concessional rate of interest from their employer as per the service rules and the intention of the Legislature is not to treat interest free loan at a concessional rate as a 'perquisite' by virtue of section 17(2)(vi) as the same was withdrawn by deletion of sub -clause (vi) of section 17(2) with effect from the date of its insertion by enacting the Finance Act, 1985, which was a measure of relief to the salaried tax payers. Hence the re -introduction of the same by exercising the power under section 295(2)(c) of the Act is impermissible. It was further stated that even assuming that interest subsidy can be treated as a perquisite the second respondent is not entitled to fix the rates at 10 per cent. or 13 per cent. as the benchmark rate for computing the value of perquisite. They also rely on the Budget Speech rendered by the Finance Minister for 2002 -2003 which is extracted at page 7 of the original petition to the effect that it was proposed to provide that no perquisites will be assessed for the assessment year 2002 -03 in the case of employees whose taxable salary, excluding perquisites, is up to Rs. 1,00,000 and for the subsequent years, to give an option to the employer to pay the tax on perquisites on behalf of the employees. In the previous year, according to the Minister's speech, it had rationalized the rules for valuation of perquisites on the basis of their cost to the employer, except in respect of houses and cars where different criteria are adopted for simplicity. According to the petitioner, the intention of the Legislature is to determine the value of perquisites on the basis of their cost to the employer. The cost of funds of the third respondent bank was 8.98 per cent. for the year ended March 31, 2001, which came down to 8.64 per cent. for the year ended March 31, 2002. The annual report of the bank is produced as exhibit P2 in support of the said contention.