ARUN KUMAR vs UNION OF INDIA .

The Supreme Court upheld the validity of Rule 3 of the Income Tax Rules, 1962, as amended by the Income Tax (Twenty-second) Amendment Rules, 2001, stating that it is consistent with Section 17(2) of the Income Tax Act, 1961. The Court found that the amendment does not violate Article 14 of the Constitution, as it provides a reasonable method for computing the valuation of perquisites. Consequently, the appeals challenging the amendment were dismissed, affirming the legality of the revised computation method for rental accommodation provided by employers.