Meal Cards – The Income Tax(IT) Missive

Meal Cards – The Income Tax(IT) Missive

In continuation of my post of 27^th August, 2009, on Meal Cards,

http://prashantnepayments.blogspot.com/2009/08/meal-cards-ing-vysya-bank-new-player.html

Please find enclosed the relevant link, regarding new IT Provisions, governing Meal Cards

http://law.incometaxindia.gov.in/TaxmannDit/DispCitation/htmpage.aspx?fn=http://law.incometaxindia.gov.in/DitTaxmann/Notifications/IncomeTaxAct/2009/Not1_2009.htm

  

The major point in this Notification is that

QUOTE

vii) The aggregate amount of ready to eat food or non-alcoholic beverage purchased during a day by an employee shall not exceed one hundred rupees

UNQUOTE

Of course, the Income Tax authorities must have had a valid reason for the above clause, or they might have been mis-informed about the true benefits of Meal Cards.

I hope the second part is true, and the relevant Institutions, have taken up with Income Tax authorities and Reserve Bank of India, to popularize this ePayment Product.

In fact, I think there should not be any IT restrictions on this ePayment Product, as the complete transaction details are electronically stored, and the Issuing Institution, will have the records safely stored.

These electronic records can be called by IT Authorities, in case of any need.

There is some confusion, as to whether these provisions will apply to Meal Cards only, and not to Vouchers like Sodexho, Ticket etc.

If so, than, the Meal Cards will not be popular in our country, and Banks/Institutions will find it difficult to market this ePayment Products.