The revenue contended that provisions of section 17 that there would be a tax liability even if section 56(2)(vii) does not apply, as the assessee being an employee of the company.  The Tribunal held that  the provisions of section 17 do not apply to the shares allotted by the company to the assessee as the shares were not allotted by the company to the assessee in his capacity of being an employee of the company. The shares were offered and allotted to the assessee by the company by virtue of the assessee being a shareholder of the company. Therefore the provisions of section 17 are not applicable. Circular No. 710 dated 24-7-1995 also supports the assessee’s stand that where shares are offered by company to a shareholder, who happens to be an employee of the company at the same price as have been offered to other shareholders or the general public, there will be no perquisite in the shareholder’s hands. In the instant case, the shares were offered to the assessee and other shareholders at a uniform rate of Rs. 100 and therefore, the difference between the fair market value and issue price cannot be brought to tax as a perquisite under section 17 of the Act.