S. Ranganathan, J.
(1) The assessed. applicant in this income fax reference is a retired officer of the Indian Navy. The reference arises out of his assessment for the assessment year 1966-67 for which the relevant previous year ended on 31st March, 1966. During the previous year the assessed was employed as Secretary of the Gymkhana Club, Delhi. He received from the Gymkhana Club a salary which has been assessed at Rs. 17,2441-. He was also in receipt of a pension from the Government which has been assessed at Rs. 3,330.00 . In additional to the salary received by him from the Gymkhana Club the applicant and his wife were also provided by the club with free income-tax Officer, following the decision of the Income-tax Appellate Tribunal in the case of the assessed for the assessment year 1965-66, did not take into account in the assessment the value of the above amenity thus provided by the Club free of cost to the assessed and his wife. This order of the Income-tax Officer was revised by the Commissioner of Income-tax under Section 263 ofthe Income-tax Act, 1961. In response to the notice under Section 263 it was contended on behalf of the assessed before the Commissioner that the value of the free food was not taxable as a perquisite in the hands of the assessed inasmuch as the salary paid by the Club to the assessed was less than Rs. 18,0001-.This contention was rejected, the Commissioner pointing out that the total income assessed under head 'salaries' in the case of the assessed being in excesss of Rs. 18,000.00 the perquisite provided in the form of free meals to the assessed and his wife was liable to be included in the assessable income after omputing its value in accordance with law after giving the assessed an opportunity of being heard in regard to the quantum thereof.
(2) The assessed preferred an appeal from the order of the Commissioner to the Appellate Tribunal and relied on the decision taken by a single member of the Tribunal in relation to the earlier assessment year. This appeal came on for hearing before a bench of the Tribunal which found itself unable to agree with the earlier view taken by the single member of the Tribunal. It pointed out that there was nothing in the language of Section 17(2)(iii)(c) to suggest that it is only the income received from the employer from whom the perquisite was received that should be taken into account in computing the limit of Rs. 18,0001- referred to in the said clause. According to the Tribunal the genesis of the above provision was quite simple. It was to take a perquisite only in respect of persons whose income under the head 'salaries' was Rs. 18,0001- or more. It did not seen to be the intention of the legislature to impose the further restriction that the above salary should be only from the same employer who had granted the perquisite. In principle also the Tribunal saw no reason to hold differently. It, thereforee, uphold the order of the Commissioner and dismissed the appeal of the assessed.
(3) At the request of the assessed the following question has been referred to us for decision : Whether on a correct interpretation of the provisions contained in Section 17(2)(iii)(e) of the Income-tax Act the Tribunal was right in holding that the limit of Rs. 18.0001- mentioned in the said section refers to the income from salaries from all employers and former employers put together and not the income under the head 'Salaries' received from the employer which granted the perquisite.
(4) Under Section 14 of the Income-tax Act all income for the purposes of income tax and for computation of total income is classified under six heads the first of which is 'salaries'. The computation of income under this head is governed by Sections 15 to 17. Under Section 15 any salary due from an employer to an assessed in the previous year whether paid or not is, inter alia, chargeable to income tax under the head 'salaries'. The income so chargeable under the head 'Salaries' is to be computed after making the deductions set out in Section 16. The expression 'salary' used in Section 15 is defined in Section 17 as including inter alia, 'any fees, commissions, perquisites or profits in lieu of or in addition to any salary or wages'. Section 17(2) defines 'perquisites'. It reads : 'perquisite' includes (i) the value of rent-free accommodation provided to the assessed by his employer: (ii) the value of any concession in the matter of rent respecting any accommodation provided to the assessed by his employer ; (iii) the value of any benefit or amenity granted or provided free of cost or at concessional rate in any of the following cases (a) by a company to an employee who is a director thereof; (b) by a company to an employee being a person who has a substantial interest in the company; (e) by any employer (including a company) to an employee to whom the provisions of paragraphs (a) and (b) of this sub-clause do not apply and whose income under the head ''Salaries', exclusive of the value of all benefits or amenities not provided for by way of monetary payment, exceeds eighteen thousand rupees; (iv) any sum paid by the employer in respect of any obligation which, but for such payment, would have been payable by the assessed; and (v) any sum payable by the employer, whether directly or through a fund, other than a recognised provident fund or an approved superannuation fund, to effect an assurance on the life of the assessed or to effect a contract for an annuity;'
(5) From the definition of 'perquisite' set out above ii will be seen that the amenities or benefits covered by subclause (i), sub-clause (ii), sub-clause (iv) and sub-clause (v) are taxable as perquisites in the hands of all employees when such amenities are provided to such employees by their employer. Sub-clause (iii) however stands on a slightly different footing. This is a general clause which seeks to bring to tax the value of any benefit or amenity granted or provided free of cost or at concessional rate by an employer to his employee. The language of this clause is very wide and is capable of bringing within its fold various types of benefits or amenities substantial or insubstantial capable of easy evaluation or otherwise and charge the value thereof in the hands of the employee in receipt thereof. Having regard to the wide range of the benefits or amenities the value of which is assessable under this clause the legislature considered it necessary to place certain restrictions or qualifications for such assessment. The clause directs that the benefit or amenity granted or provided free of cost or at concessional rate not falling under clauses (i) (ii), (iv) or (v) should be taxable as perquisite only in two sets of cases : (a) where they are provided by a company to an employee who is a director thereof or who has a substantial interest in it ; and (b) where they are provided by any employer (including a company) to an employee provided 'the income under the head 'Salaries' exclusive of the value of all benefits or amenities not provided for by way of monetary payment' of such employee exceeds Rs. 18,000.00 . In other words, the intention of the legislature was that the benefits or amenities which are not in the form of monetary payments should not be taxed except (a) in the case of employees who are closely related to a company employer which provides them with such benefit or (b) excent where the employee is not a low paid employee. The standard provided for the section to determine the latter category of employees in whose case sub-clause (iii) will be attracted is that the income of such employee under the head 'salaries' should be above Rs. 18.0001-. There is nothing in the language of this provision to show or to indicate that in determining the category of this employee, only the income by way of salaries received by him from the employer who provides the amenity should be taken into account. The language of the sub-clause clearly states that what is to be determined is the income of the employee under the head 'salaries' leaving out of account only the value of benefits and amenities not provided for in cash. The income received by the employee from another employer or former employer, if taxable under the head 'salaries', has necessarily to be taken into account in determining the limit of Rs. 18,000- referred to in this sub-clause, in the present case the assesses received a salary of little less than Rs. 18.000.00 from the Gymkhana Club but the pension received by him from the Government is clearly income received by him falling under the head 'salaries' referred to in the sub-clause.
(6) Shri D. K. Jain, learned counsel for the asscssee submitted that while Sections 15 and 16 used the words 'income chargeable', the word 'chargeable' is not to be found in Section 17. We are unable to see how this helps the present assessed. The amount received by the assessed as pension is income and is also chargeable to tax under the head 'salaries'. There is no escape from the conclusion that the income of the assessed under the head 'salaries' is Rs. 20,5741- (Rs. 17,244.00 + Rs. 3.330.00 ). The present case, thereforee, clearly falls within the net of Section 17(2)(iii)(c).
(7) Shri D. K. Jain also contended that, in the context of Section 17, the amenity, the value of which is sought to be taxed is being provided for by a particular employer and that, thereforee, the question of its assessability must depend upon the amounts paid to the employee by the said employer by way of salaries and that the salary income that may be received by the employee from other sources' of employment need not be and should not be taken into account. We have already pointed out that there is no scope for restricting the interpretation of Section 17(2)(iii)(c) in the manner suggested by the learned counsel. The object of the section is to bring to tax the value of such amenities or benefits in the case of employees who have a certain amount of income; that standard is set out in very wide language which there is no reason to restrict. That apart, we may point out that the interpretation sought to be placed by the learned counsel can also land itself to abuse and manipulation.
(8) For the reasons discussed above we agree with the view taken by the Tribunal and answer the question referred to us in the affirmative and in favor of the revenue. In the circumstances of the case, however, we make no order as to costs.