Single-stage grossing up for employer-paid tax perquisites was upheld as multi-stage grossing up was held inapplicable.

In computing tax perquisites paid by an employer on behalf of an assessee, the question was whether single-stage grossing up could be applied instead of multi-stage grossing up under the Income-tax Act, 1961. The issue was treated as covered by an earlier Division Bench ruling that multiple-stage grossing up did not apply to notional income under section 44BB read with section 195A. On that basis, the Tribunal's direction to apply single-stage grossing up was upheld and the appeal failed.

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Issues: Whether, in computing tax perquisites paid by the employer on behalf of the assessee, single-stage grossing up was permissible instead of multi-stage grossing up under the Income-tax Act, 1961.

Analysis: The issue was covered by an earlier Division Bench decision holding that multiple-stage grossing up was not applicable to notional income under section 44BB read with section 195A of the Income-tax Act, 1961.

Conclusion: The Tribunal's direction to apply single-stage grossing up was upheld and the appeal failed.

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