The assessee was a former employee of a company that was part of a Singapore\u2011based group which had granted employee stock options. The assessee was granted 127,552 options under a vesting schedule. After a disinvestment announced on December 23, 2022, the value of the options fell and, on April 21, 2023, the Singapore company made a one\u2011time voluntary payment of USD 43.67 per option to option\u2011holders as compensation for loss in value. The company stated it would withhold tax. The assessee applied under section 197 for a nil deduction certificate; the application was rejected by the Department treating the payment as a perquisite under section 17(2)(vi). On writ: the court held that the options had not been exercised and no contingency in section 17(2)(vi) had occurred; the payment was voluntary and not a statutory or contractual transfer by the employer linked to employment; hence, it was not a perquisite and not chargeable to tax. The rejection was invalid; the assessee was given liberty to apply for refund of TDS.<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 17(2) : Salary-Perquisite-Stock options provided to ex employees-Stock options were not a perquisite; no exercise of options-No income chargeable to tax-Not liable to deduct tax at source. [S. 5, 17(2)(vi), 197, Art. 226] <\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-56633","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-eJr","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/56633","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=56633"}],"version-history":[{"count":1,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/56633\/revisions"}],"predecessor-version":[{"id":56634,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/56633\/revisions\/56634"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=56633"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=56633"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=56633"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}