TaxTMI 
TaxTMI 
2020 (1) TMI 990
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.... the Tribunal for AY 2007-08 had, on a similar plea being made by the assessee, accepted the same, blocking its' appeal for that year till the disposal of the said appeal for AY 2006-07 by the Hon'ble High Court (in ITA No. 7/Jab/2011, dated 17/9/2013/copy on record). The order by the Hon'ble High Court for AY 2006-07 (in ITA No. 232/Jab/2009, dated 6/1/2010), admitting a question of law, is also placed on record. 2.2 The ld. Senior Departmental Representative (Sr. DR) would submit that the assessee has not, even after a lapse nearly ten years, stated the status of its' appeal before the Hon'ble High Court. It's prayer is under the circumstances not acceptable. The Tribunal is obliged to follow its' order for AY 2006-07, admittedly deciding the same issue. The assessee could file an appeal for the current year as well, which would then get tagged along with that for AY 2006-07. The Tribunal for AY 2006-07 upheld the levy of Fringe Benefit Tax (FBT) on free electricity provided to its' employees by the assessee-employer as it had, in view of the employees having contested the deduction of tax at source thereon by treating it as a perquisite u/s. 17(2) chargeable under the head 'S....
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....rnment, is an independent person, and not a part of the State. That is, was not a party to the lis, i.e., if the same be regarded as one. There is, as such, no such matter before the Hon'ble High Court in the assessee's case and, rather, none which can be said to be sub-judice before it. The assessee is, in any case of the matter, bound by law, which is what the Hon'ble High Court has directed, and which is equally applicable to the assessee. Rather than taking shelter under the plea of the matter being subjudice - which it is not, it, on the contrary, has the benefit of the decision by the higher courts, even otherwise binding. There is, in any case of the matter, it needs to be emphasized, no estopple against law. Now, if it regards the free/concessional electricity supplied to its' employees as a perquisite in their hands, it ought to have deducted tax at source and, if not, paid FBT, thereon. It is not open for it to deny its' liability both toward TDS (on the said benefit) as well as under FBT, and which is what it in effect does and, further, without any explanation; the plea of 'subjudice' being found incorrect even as, as afore-stated, there is no estopple against law. 3....
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....t of tax by the concerned employees, who have rather 'resisted' tax deduction at source thereon, can, under the circumstances, only imply that the same has not been regarded as a perquisite and, in any case, a perquisite in respect of which tax is payable by the concerned employees. Even no demand, as apparent, has been raised on the assessee u/s. 201(1). 3.4 Continuing further, section 115WB defines 'fringe benefit' and 'deemed fringe benefit' under sub-sections (1) and (2) thereof. Sub-section (3) of s.115 WB(3) reads as: 'For the purposes of sub-section (1), the privilege, service, facility or amenity does not include perquisites in respect of which tax is paid or payable by the employee or any benefit or amenity in the nature of free or subsidized transport or any such allowance provided by the employer to his employees for journeys by the employees from their residence to the place of work or such other place of work to the place of residence.' Clearly, therefore, only a perquisite in respect of which tax has been paid or is payable by the employees is excluded from the ambit of sec. 115 WB(1). This is as a benefit, for its exclusion under FBT u/s.115-WB(1), mus....
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....ocked the appeal which, stated to be under sec. 158A(1), is also without observing the prescribed procedure u/s. 158A(2). Further still, the question of law raised before the Hon'ble Court, which reads as under, does not, in our view, fully capture the controversy at hand; it, rather, questioning the wisdom in upholding the FBT on a perquisite on which tax is payable by the employees: 'On the facts and the circumstances of the case, whether the Tribunal was justified in holding that the appellant is liable for FBT without examining section 115WB(3) of the Income Tax Act which clearly says that FBT will not be payable in respect of which tax is payable by the employees in view of section 17(2) of the Income Tax Act read with Rule 3(4) of the Income Tax Rules?' The Tribunal for AY 2006-07 is fully conscious, as are we, that there is no estoppel against law, so that where tax is indeed payable by the employees on a perquisite, the same gets excluded under FBT. Again, without doubt, it is the correct legal position that is relevant, and not the view that the parties may take of their rights in the matter [see, inter alia, CIT v. C. Parakh & Co. (India) Ltd. [1956] 29 ITR 66....
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....loyer to his employee/s where not regarded as a perquisite on which tax is payable by him, is on the assessee-employer, the payer. This, in our view, represents the actual controversy arising in the instant case, i.e., could an assessee-employer deny its' liability u/s. 4 r/w s. 192, as well as u/s. 115WA(1), i.e., qua a benefit to the employees, by raising a plea that the tax on former is payable by the employees, so that the tax gets collected or paid under neither. This is as, without doubt, as afore-stated, admission of liability and/or discharge thereof, under one would preclude the other. It would, we admit, be a different matter; there being no estopple against law, if there was no obligation in law on the assessee to deduct and deposit the tax payable on the perquisite to its' employees. The foregoing would also explain our non-acceptance of the assessees' plea for blocking the appeal, even if regarded as made with reference to s.158A(1), which would though, as afore-noted, require us to observe the procedure u/s. 158A(2). We say so inasmuch as an application in Form 8 (dated 15/6/2016) is found to have been submitted, i.e., on record, so that it could well be and, rathe....