9911796707
TMI Blog2014 (5) TMI 277X X X X Extracts X X X X X X X X Extracts X X X X ..... favour of Assessee. - I.T. A. No. 3249 /AHD/2010 - - - Dated:- 2-5-2014 - Shri G. C. Gupta And Shri Anil Chaturvedi, A.M.,JJ. For the Appellant : Shri Vartik Choksi For the Respondent : Shri O. P. Meena, Sr. D.R. ORDER Per Shri Anil Chaturvedi,A. M. 1. This appeal is filed by the Assessee against the order of CIT(A)-VI, Ahmedabad dated 03.09.2010 for A.Y. 2006-07. 2. The relevant facts as culled out from the material on record are as under. 3. Assessee is a company stated to be engaged in the business of Manufacturing and Marketing of Readymade Garments. Assessee filed its return of Fringe Benefit on 26.12.2006 declaring value of Fringe Benefit of Rs. 2,00,64,157/-. The case was selected for scrutiny and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 44,16,883 4 Conveyance, Tour and travels (including Foreign Travel) 1,61,662 4. Though the Assessee has raised 2 grounds but the issue in both the grounds is with respect to levy of Fringe Benefit Tax (FBT). 5. During the course of assessment proceedings, A.O noticed that Assessee had not paid FBT on Fringe Benefit Value of Rs. 48,77,462 related to the expenses incurred on the persons who were not the employees of the Assessee but however the Assessee, as per the direction of Gujarat High Court deposited Rs. 13,99,435/- in a separate current account opened with State Bank of Saurashtra. A.O. was of the view that in view of subsection( 2) of Section 11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rpose of employee, is fully taken for the purpose of Fringe Benefit Tax. However, other expenses in the nature of entertainment, sale promotion, conveyance , travelling, gifts etc. may have partial benefit to the employees and therefore, only a part is treated as Fringe Benefit. Since, section clearly defined the value of Fringe Benefit, no further adjustment to the items of expenses debited in profit and loss account is permitted and accordingly Assessing Officer is justified in applying the rates applicable to the particular expense given in the act to arrive at the value of Fringe Benefit. The decision in the order of Hon'ble Gujarat High Court does not put any stay on the assessment or appeal proceeding in this matter. It only pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used the material on record. The dispute in the present case is with respect to charging of FBT on Sales Promotion Expenses which the Assessee claims to have incurred in relation to non-employee and were purely for the purpose of business. In the present case, there is no finding of A.O or CIT(A) as to whether the expenses which have been incurred were for employees or nonemployees and whether the expenses were for the purpose of business. We further find that in the case of Intas Pharmaceuticals Ltd. (supra), the Co-ordinate Bench of Tribunal, relying on the decision in the case of Arvind Fashions Ltd. vs. DCIT, remitted the matter to the file of A.O by holding as under:- 6. We have considered rival submissions and perused the orders of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hether the expenses in question were incurred with relation to non-employees for the business purpose of the assessee as claimed by the assesseecompany. In case the expenses are found to have been incurred by the assessee with relation to nonemployees and for the business purpose of the assessee, the decision in Arvind Fashions Ltd. Vs. DCIT (supra) shall apply to the case of the assessee. Needless to say that any decision of the Hon'ble Gujarat High Court in the writ petition pending before the Hon'ble High Court, as mentioned by the CIT(A) in its appellate order, shall be binding on the authorities. We direct accordingly. 9. In the present case as noted above, since there is no finding as to whether the expenses were incurred f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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