2010 (4) TMI 1221 - AT - Income Tax

Summary

Issues involved: Appeal against order of CIT(Appeals) regarding revised working of fringe benefit tax, applicability of exemptions, and jurisdictional High Court's decision.

Issue 1 - Revised working of fringe benefit tax:
The appeal was filed by the Revenue against the order of the CIT(A) directing the Assessing Officer to accept the revised working of fringe benefit tax submitted by the assessee company during assessment proceedings. The Revenue argued that exemptions should have been claimed by filing a revised return of fringe benefits. The AO rejected the revised computation by the assessee on this ground. However, the first appellate authority applied the decision of the jurisdictional High Court and directed the AO to accept the revised workings submitted by the assessee. The Tribunal upheld the CIT(A)'s decision, emphasizing that the AO should not assess the incorrect income offered by the assessee, which is not chargeable to tax under the provisions of the Act.

Issue 2 - Value of fringe benefits:
The Revenue contended that the assessed value of fringe benefits cannot be less than the returned value. However, the Tribunal found that the revenue authorities did not verify the revised computation and exemptions claimed by the assessee from the value of fringe benefits declared in the return. Therefore, the Tribunal set aside the matter to the file of the AO with a direction to verify the revised computation and dispose of the case in accordance with the law. The appeal of the Revenue was allowed for statistical purposes.

Issue 3 - Applicability of judgment in M/s Goetze India Ltd. vs. CIT:
The Revenue argued that the judgment in the case of M/s Goetze India Ltd. vs. CIT 284 ITR 323 (SC) is applicable in this case. However, the Tribunal did not specifically address this argument in its judgment.

Conclusion:
The Tribunal upheld the CIT(A)'s decision to accept the revised working of fringe benefit tax by the assessee and directed the AO to verify the revised computation and exemptions claimed. The appeal of the Revenue was allowed for statistical purposes, and the matter was remanded to the AO for further proceedings in accordance with the law.