P. Vishwanatha Shetty, J.— Since, in all these petitions common questions have been raised and arose for consideration, all these petitions along with a few other connected petitions were taken up for hearing together.

2. The petitioner in Writ Petition No. 7405 of 2002 and Writ Petitions Nos. 8891 to 9021 of 2002 is the BHEL Employees' Association which is a registered trade union under the Indian Trade Unions Act, 1926 (hereinafter referred to as "the Trade Unions Act"). It is claimed by the petitioner in the said petitions that the petitioner-association represents the interest of the workmen numbering around 1,100 employed in the Electronics Division of the Bharat Heavy Electricals Ltd. (hereinafter referred to as "the BHEL") ; and these petitions have been filed by the association on behalf of the members who are residing in the BHEL quarters and also in the colony belonging to the BHEL.

3. The first petitioner in Writ Petition No. 7205 of 2002 is Bharat Earth Movers Officers' Guild and the second petitioner is the assistant manager employed in the Bharat Earth Movers Ltd. (hereinafter referred to as "the BEML"). The first petitioner in Writ Petition No. 7206 of 2002 is the ITI Officers' Association and the second petitioner in the said petition is the assistant executive engineer in the employment of the Indian Telephone Industries (hereinafter referred to as "the ITI"). It is claimed by the BEML Officers' Guild and also by the ITI Officers' Association in these petitions that the associations have been constituted to secure and safeguard the legitimate, legal rights and privileges of its members.

4. The petitioner in Writ Petition No. 8253 of 2002 is the All India State Bank Officers Federation, a trade union registered under the Trade Unions Act; and the petitioner in Writ Petition No. 8254 of 2002 is a deputy manager of the State Bank of India.

5. It is the case of the petitioners that the respondents in these petitions are either Government of India companies, or banks or public sector enterprises and they are functioning under the administrative control of the Government of India and all of them are instrumentalities of the State within the meaning of article 12 of the Constitution of India. It is also the case of the petitioners that the respondent-companies, undertakings and banks provide residential accommodation/quarters either constructed and owned on their own or taken on lease for the purpose of allotting the same to its employees and they also advance loans either free of interest or at concessional rate of interest.

6. In these petitions they have called in question the constitutional validity of-

1. Section 17(2)(vi) of the Income Tax Act, 1961, as amended by means of the Finance Act, 2001 ; and

2. Rule 3 of the Income Tax Rules, 1962, as notified by the fifth respondent by means of its notification dated September 25, 2001, a copy of which has been produced as annexure "A" to this petition.

7. In some of the petitions, in addition to the challenge made to the constitutional validity of Clause (vi) of Sub-section (2) of Section 17 of the Act and Rule 3 of the Rules, the petitioners also have challenged the validity of the notification/order/memo issued by the management of the companies/banks/ undertakings, proposing to deduct Income Tax on the value of perquisites given to their employees.

8. As noticed by me earlier, the petitioners in these petitions are either the associations or the employees of companies, banks or public sector undertakings.

9. A few facts, which are not in serious dispute and relevant for the disposal of these petitions may be stated as hereunder :

The Union of India amended Section 17(2) of the Income Tax Act, 1961 (hereinafter referred to as "the Act"), by means of the Finance Act, 2001, with effect from April 1, 2002, by inserting Sub-clause (vi) to Section 17(2) of the Act. Sub-clause (vi) of Section 17(2) of the Act, as amended, reads as follows : "(vi) the value of any other fri