Difference Between Allotted and Market Price of ESPS Shares Not Taxable as Perquisite u/s 17(2)(iiia) of

The Delhi High Court ruled that the difference between the allotted and market price of shares under an Employee Stock Purchase Scheme (ESPS) is not taxable as a perquisite under Section 17(2)(iiia) of the Income Tax Act. The Court found that the tax authorities had wrongly classified this difference as a taxable benefit, clarifying that such price differences fall outside the scope of perquisite taxation. This ruling offers relief to employees participating in ESPS, ensuring fair tax treatment.