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TMI Blog2014 (3) TMI 685X X X X Extracts X X X X X X X X Extracts X X X X ..... ss purpose of the assessee. Assessee contended that the expenses were not related to its employees and were incurred only in relation to non-employees and for business purpose of the assessee – this, the matter is remitted back to the AO for fresh adjudication - The AO is further directed to record a clear finding that whether the expenses in question were incurred with relation to non-employees for the business purpose of the assessee as claimed by the assessee-company – Decided in favour of Assessee. - ITA No. 3086, 3087 and 3088/Ahd/2010 - - - Dated:- 3-3-2014 - Shri G. C. Gupta And Anil Chaturvedi,JJ. For the Petitioner : Shri Vartik Chokshi For the Respondent : Shri T. P. Krishnakumar, DR ORDER Per G. C. Gupta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 Maintenance of Guest House 94,301 3. The ld.CIT(A) erred in law and in the facts and in circumstances of the case by incorrectly applying the provisions of section 115WB(2) of the Income Tax Act, 1961 and thereby levying FBT on expenditure which had no direct/indirect connection to the employees of the appellant company which is precondition as per the provisions of the Act and also the legislative intent as explained by the budget speech in the explanatory notes. 4. The ld.CIT(A) erred while acting as the first appellate authority under the Income-tax Act, 1961 was certainly not bound by that Circular and, accordingly, he ought to have rendered his own decision on all the issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal before him without being bound by the said CBDT Circular. 4. Concise grounds of the appeal of the assessee for A.Y.2008-2009 in ITA No.3088/Ahd/2010 are as under: 1. In law and in the facts and in circumstances of the appellant's case, the learned CIT(A) has grossly erred in confirming the addition of Rs.7,97,56,984/- even though they have not been incurred for the employees of the appellant company. 2. In law and in the facts and in circumstances of the case, learned CIT(A) erred in not appreciating that fringe benefit tax is not liable to be paid by the appellant in respect of the following items of expenditure as they have been incurred only with relation to non-employees and are being purely for the business purposes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not incurred on employees or their family members. The ITAT, Ahmedabad Bench has followed a number of decisions of various Benches of the Tribunal on this issue as recorded in this order. The learned DR has opposed the submissions of the learned counsel for the assessee. He relied on the orders of the AO and the CIT(A) and submitted that the CIT(A) has referred in his appellate order that the issue is pending before the Hon'ble Gujarat High Court in writ petition and the Hon'ble Gujarat High Court has not set side the Circular No.8 dated 29.8.2005 of CBDT. 6. We have considered rival submissions and perused the orders of the AO and the CIT(A) and the order of the Tribunal in Arvind Fashions Ltd. Vs. DCIT (supra). We find that the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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