"No concession no perquisite" is for employee and not for employer for TDS computation

Supreme Court interprets its Arun Kumar v. UOI ruling on perquisite of concession in rent under section 17(2)(ii)

"No 'concession', no perquisite under section 17(2)(ii)" stand available to employees in their individual assessments and not to the employer for deducting TDS under section 192

• The stand that the value of the accommodation provided to the assessee was not really a "concession" can be taken only by individual employees in their assessment proceedings and not by the employer for deducting TDS under section 192.
• This is because the scheme of the Act provides that after the employer deducts tax from the salary of the employee and pays the same to the Central Government, a Tax Deduction Certificate is furnished to the employee and it is for the employee to claim before the Assessing Officer in the assessment proceedings and get a determination done and in case he succeeds before the Assessing Officer, he will be entitled to refund out of the amount of tax deducted at source by the employer.
• Employer has to deduct TDS in respect of accommodation provided at concessional rent under section 17(2)(ii) on 10 per cent of salary as per rule 3.
• Individual employees are free to make their respective claims before the Assessing Officer for the refund of the deduction made by the employer on 10 per cent of the salary towards 'perquisite' in respect of any concession given to the assessee by claiming that there is no 'concession'.
• During the period the interim order of the High Court was in force, , the ONGC cannot be held to be in default under the provisions of the Act inasmuch as the ONGC was prevented by the Order of the High Court from deducting the tax on 10 per cent of the salary of its employees under Section 192(1) of the Act, and to pay the same to the Central Government under section 200 of the Act.
• Hence, during the period , the ONGC cannot be deemed to be an assessee in default under the provisions of the Act. Consequently, the provisions of sub-section (1A) of section 201 of the Act for payment of interest by an assessee in default under the provisions of the Act will not be applicable to the payments not made by the ONGC because of the interim order passed by the High Court.