As per the Finance (No. 2) Act, 2009 w.e.f. the financial year 2010- 2011 the value of any specified security or sweat equity shares allotted or transferred, directly or indirectly by the employer, or former employer, free of cost or at concessional rate to the employee would be treated as a “perquisite” in the hands of an employee and subjected to tax.
On and from 1-4-2009 the Fringe Benefit Tax is abolished w.e.f. the F.Y. 2009-10. Hence the new concept of taxation in the hands of employee would operate.
Please keep a watch on the direct taxes code and future legislation which might contain a good news relating to taxation of stock options.