The standard rent fixed by the Government or other authorities is acceptable as the normal rent for the purpose of determining the question of concession in rent.

( 1 ) TWO questions arise for determination in this case :" (1) Whether accommodation provided by a nationalised bank for which rent is fixed under the Regulations of the bank is a perquisite within the meaning of Section 15 read with Section 17 (1) (iv) and Section 17 (2) of the Income-tax Act, 1961 (referred to as 'the Act') ? (2) Whether the demand for tax treating such accommodation as perquisites could be made retrospectively ?"

( 2 ) THE petitioners are employees of the Indian Bank. The Indian Bank is a nationalised bank and is governed by the provisions of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970. In exercise of the powers conferred by Section 19 read with Sub-section (2) of Section 12 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, the board of directors of the Indian Bank in consultation with the Reserve Bank of India and with the previous sanction of the Central Government made the Indian Bank (Officers) Service Regulations, 1979 (referred to as "the Regulations" ). In terms of the Regulations, the standard rent in respect of accommodation owned by the bank and given to the employee for occupation has been defined as follows :"1. For the purposes of this regulation, 'standard rent' means-- (a) in the case of any accommodation owned by the bank, the standard rent calculated in accordance with the procedure for such calculation in vogue in the Government ; (b) with effect from April 1, 1990, where accommodation has been hired by the bank, contractual rent payable by the bank or rent calculated in accordance with the procedure in (a) above, whichever is lower. "

( 3 ) REGULATION 25 may also be noted in this context. "25. On and from November 1, 1987, no officer shall be entitled as of right to be provided with residential accommodation by the bank. It shall, however, be open to the bank to provide residential accommodation on payment by the officer of 6 per cent. of the pay in the first stage of the scale of pay in which he is placed or the standard rent for the accommodation whichever is less. Provided that a further sum equal to 11/2 per cent. of pay in the first stage of the scale of pay will be recovered by the bank from an officer if furniture is provided at such residence. Provided further that, where such residential accommodation is provided by the bank, the charges for electricity, water, gas, and conservancy shall be borne by the officer. "

( 4 ) THE petitioners had been paying rent in accordance with the standard rent as fixed by the Regulations to the bank in respect of the accommodation given to them by the bank. Till recently such accommodation was never treated as a perquisite by the income-tax authorities. On June 19, 1992, the bank sought to add the value of the accommodation occupied by the petitioners as a perquisite under Section 17 of the Act calculated under Rule 3 (a) (ii) of the Income-tax Rules, 1962 (referred to as "the rule"), to the total income of the petitioners. Deductions were accordingly sought to be made by the bank from the petitioners on such basis. Deductions were sought to be made not only for the current year but also for the financial year ending on March 31, 1992. Being aggrieved by the action on the part of the Indian Bank, the petitioners filed this writ application in April, 1993.

( 5 ) AN interim order was passed restraining the respondents from realising any amount on account of income-tax on the basis of the perquisite value of the accommodation subject to certain terms and conditions. The interim order which was granted on April 7, 1993, is still operating.

( 6 ) ALTHOUGH directions were given for filing of affidavits, no affidavit-in-opposition has been filed by the respondent-authorities till date. Indeed, even at the hearing, the facts, as narrated above, have not been disputed by any of the respondents. The question is one of interpretation. Section 15 of the Act provides for chargeability