Supreme Court says interest-free loans given to bank employees taxable

Supreme Court says interest-free loans given to bank employees taxable as 'fringe benefits' The Supreme Court has affirmed that the interest-free or concessional loans provided by banks to their employees are considered "fringe benefits" and are subject to taxation. A bench of Justices Sanjiv Khanna and Dipankar Datta emphasized that the loan privilege enjoyed by bank staff is distinct and constitutes a "perquisite," contrasting it with "profit in lieu salary," which serves as a form of reward or compensation for past or future services. "It is incidental to employment and in excess of or in addition to the salary. It is an advantage or benefit given because of employment, which otherwise would not be available," the bench stated, as per the Economic Times. Although the court upheld the income tax regulation, it clarified that the setting of the State Bank of India's interest rate as the benchmark was neither arbitrary nor an unequal exercise of power. [Read more]( If you would prefer not receiving our emails, please [Click Here](