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December 2025

Income — Capital or revenue receipt — One-time compensation received for surrendering of stock received under stock option scheme of employer :— (a) TDS — Rejection of application u/s. 197 for NIL deduction of tax — Stock option not perquisite amenable to tax — Order rejection application quashed and set aside; (b) Applicability of section 45 — Cost of acquisition of stock option cannot be determined — Capital receipt not chargeable u/s. 45 not chargeable under any other head — Charging section and computation section constituted an integrated code.

By Keshav Bhujle | Ritu Punjabi, Advocates
Reading Time 4 mins

48. (2025) 479 ITR 1 (Karn): 2025 SCC OnLine Kar 18963

Manjeet Singh Chawla vs. Dy. CIT(TDS)

A. Ys. 2024-25: Date of order 02/06/2025

Ss. 5, 17(2), 45, 48 and 197 of ITA 1961

Income — Capital or revenue receipt — One-time compensation received for surrendering of stock received under stock option scheme of employer :— (a) TDS — Rejection of application u/s. 197 for NIL deduction of tax — Stock option not perquisite amenable to tax — Order rejection application quashed and set aside; (b) Applicability of section 45 — Cost of acquisition of stock option cannot be determined — Capital receipt not chargeable u/s. 45 not chargeable under any other head — Charging section and computation section constituted an integrated code.

The petitioner is an Indian citizen and a salaried employee of Flipkart Internet Private Limited (FIPL). FIPL is an Indian subsidiary of Flipkart Marketplace Private Limited (FMPL), a company incorporated in Singapore; which is further a wholly owned subsidiary of Flipkart Private Limited, Singapore (FPS). In addition to FMPL, FPS, Singapore has many other subsidiaries including PhonePe which had a wholly owned subsidiary in India known as?

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