TaxTMI Login
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →Just a moment...
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
These appeals concern the grossing up of taxes for determining taxable salary, as the employees were paid 'net of tax' salary. The employer company was responsible for paying all taxes under the Income-tax Act as per the employment terms. The core issue was whether the salary should be determined after single-stage or multi-stage grossing up of taxes. The Tribunal explained that in cases where employees are paid tax-free salaries, the taxable salary is determined after grossing up of salary and taxes paid. Multi-stage grossing up is required when the employer pays 'net of tax' salary, meaning the employer pays all taxes, which are added as perquisites. This process continues indefinitely, resulting in the taxable salary being the amount that, after tax deduction, equals the net salary paid by the employer. This approach is recognized by section 195A of the Income-tax Act.
Issue 2: Applicability of section 10(10CC) of the Income-tax ActThe assessee argued that multi-stage grossing up is not required due to section 10(10CC), which exempts tax on perquisites not provided by way of monetary payment. The Assessing Officer and CIT(A) did not accept this plea, resorting to multi-stage grossing up. The Tribunal considered whether taxes paid by the employer to the Government on behalf of the employees could be considered a perquisite not provided by way of monetary payment. The Tribunal concluded that the tax paid by the employer is a perquisite provided for by way of monetary payment, thus section 10(10CC) is not applicable. The Tribunal upheld the CIT(A)'s decision, confirming that multi-stage grossing up is required for determining the taxable salary in such cases.
In conclusion, the appeals were dismissed, affirming the multi-stage grossing up approach for determining taxable salary and ruling out the applicability of section 10(10CC) in these cases.
TaxTMI 
TaxTMI 
