davisjohn_hr Started The Discussion:

NOTIFICATION NO. 1/2009, DATED 5-1-2009

In exercise of the powers conferred by section 295 read with sub-clause (iii) of clause (B) of sub-section (2) of section 115WB of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely :—

1. (i) These rules may be called the Income-tax (First Amendment) Rules, 2009.

(ii) They shall come into force with effect from the 1st day of April, 2009.

2. In the Income-tax Rules, 1962, in Part VIIC, after rule 40D, the following rule shall be inserted, namely:—

"Prescribed conditions for the purposes of sub-clause (iii) of clause (B) of sub-section (2) of section 115WB.

40E. For the purposes of sub-clause (iii) of clause (B) of sub-section (2) of section 115WB, the non-transferable pre-paid electronic meal card (hereinafter called the "card") shall fulfil the following conditions, namely:—

(i) The card shall be granted by the employer to its employees under a scheme framed by the employer specifying therein the circumstances under which the meal card can be used by the employee.

(ii) The card under clause (i) shall be issued by the issuing bank.

(iii) An employee shall not be issued more than one card.

(iv) The card shall bear the name of the employer along with the name, photograph and signature of the employee to whom the card is issued.

(v) The card shall be used only by the employee to whom the card is issued.

(vi) The card shall be used by the employee only for the purpose of purchasing ready to eat food or non-alcoholic beverage from a member establishment.

(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.

(viii) The details of each transaction of purchases made by the employee against the card shall be maintained by the employer and the member establishment in such manner and for such period as is required under the Act for any other similar transaction.

Explanation.- For the purposes of this rule, —

(i) “banking company" shall have the same meaning as assigned to in clause (viii) of sub-section (1) of section 36 of the Act;

(ii) "issuing bank" means a banking company -

(a) which issues the card to the employees of an employer in pursuance to an agreement entered into with the employer; and

(b) which has entered into a contract with the member establishment authorizing him to allow purchases against the card, issued by it in accordance with the conditions stipulated in sub-clause (iii) of clause (B) of sub-section (2) of section 115WB and this rule; and

(iii) "member establishment" shall mean a restaurant, hotel, canteen or an outlet which sells ready to eat food or non-alcoholic beverage, but shall not include a restaurant, hotel, canteen or an outlet selling alcoholic beverage."

[F. No. 133/70/2008-TPL]

Courtesy :


Davis John
Asst Manager - Hr (Generalist)
BreadTalk - India

Mr. Davis, Kindly clarify if the same is applicable for meal vouchers also, as meal vouchers is also a form. Thanks & Regards,
Hi All, This is only for Meal card, not for the food vouchers or coupons. Be informed on the same. Regards, DJ.
It is found that HDFC bank are issuing Meal Cards without these terms and conditions.... Is it true?
It is not true. If you purchase for more than Rs. 100 per day card will not work. In some cases it is working but mostly it will be blocked (ie. > Rs.100). Meal card is not good choice for Tax savers. It's better to choose Sodexho/Accord food coupons.
Hi John, Thank you for providing the information. We plan to move to the meal card model in FY10 this is really of great use. Regards Parra08
Then why wouldnt all corporates go with Sodexho vouchers which benefits and helps employees when they eat out with friends and family.

I am more sick of using meal card and nowadays( in our economic and price turmoil) i dont even get a chicken dry/gravy items for just 100 rs in decent hotels and well meal cards are not acceptable in roadside shops !!! ;)



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