TaxTMI 
TaxTMI 
2011 (7) TMI 1314
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.... Per P.M. Jagtap, A.M. : This appeal filed by the assessee is directed against the order of learned CIT(Appeals), Central Circle-V, Mumbai dated 14-07-2009 and the solitary issue arising out of the same relates to the addition of Rs. 13,65,035/- made by the AO and confirmed by the learned CIT(Appeals) to the total income of the assessee on account of p....
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.... the business of the employer company. He also found that most of the said expenses going by their very nature were personal expenses of the assessee which were paid by his employer company. He noted that as per the provisions of section 17(2)(iv), any sum paid by the employer in respect of any obligation which, but for such payment, would have been payable by the assessee was liable to be taxed in the hands of the assessee as perquisite. Accordingly, relying on the said provisions, he added the amount of Rs. 14,44,354/- to the total income of the assessee as value of perquisite in the assessment completed u/s 143(3) vide an order dated 24-12-2008. 3. Against the order passed by the AO u/s 143(3), an appeal was preferred by the assessee ....
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....orld, particularly in the type of clientele the appellant deals with. Further, expenses on hair cut and availing of beauty parlor facilities are purely personal expenses. In this backdrop, most significantly, I find that the appellant has not been able to produce any evidence to justify the business need of these expenses from the point of view of the employer company. As per the settled position of law, the burden of proving the business purpose of the expenses was with the appellant, which he failed to discharge. The decisions of the Hon'ble Supreme Court in the cases CIT Vs. Calcutta Agency 19 ITR 191 and CIT Vs. Imperial chemicals and Industries Pvt. Ltd. 74 ITR 17 and of the Hon'ble Rajasthan High Court in the case of CIT Vs. Udaypur M....
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....the Resolution signifying thereby that these expenses are not for the day to day business of the appellant. The appellant's argument that the addition would amount to double taxation as the company has paid Fringe Benefit Tax on the expenses is highly inconsistent. The Fringe Benefit Tax is governed by completely different parameters and further, the fact that the company had paid Fringe Benefit Tax would only endorse the fact that the expenses are not for day to day business of the company. Besides the appellant has also not given the specifics of the items on which Fringe Benefit Tax has been paid by the company. I also find that in appellant's own case, my predecessor had the occasion to substantially confirm the additions made on simila....
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....ated in the said circular, the fringe benefit tax has been introduced as a surrogate tax on employer with the objects of resolving the problems in taxing some perquisites/fringe benefits in the hands of the employees in terms of section 17. Further, as explained in para No. 3.2 of the Circular, the scope of the term "fringe benefits provided" is defined in section 115WB(1) to mean any consideration for employment provided by way of any privilege, service facility or amenity, directly or indirectly, provided by an employer, whether by way of reimbursement or otherwise, to his employees. Moreover, as clarified in the said circular while answering frequently asked question No. 15, fringe benefit is deemed to have been provided if the employer ....
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....sstt.Year : 2007-08. I have considered the submission of the assessee. It is noticed that M/s Sri Radhakishan Shipping Pvt. Ltd., the employer of the assessee has already considered the aggregate amount of Rs. 5,63,923/- while offering the value of FBT and has paid tax of Rs. 37,963/- on Rs. 1,12,785/- being 20% of Rs. 5,63,923/-. Since the employer of the assessee has already paid tax of Rs. 37,963/- on Rs. 1,12,785/- under the Fringe Benefit Tax, the balance amount of Rs. 4,51,138/- (563923-112786) is treated as perquisite in the hands of the assessee within the meaning of section 17(2) of the I.T. Act, 1961 and the same is added to the income of the assessee." "Asstt.Year : 2008-09: I have considered the submis....