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TMI Blog2011 (7) TMI 1314X X X X Extracts X X X X X X X X Extracts X X X X ..... to the total income of the assessee on account of perquisites u/s 15 read with section 17(2)(iv) of the Act. 2. The assessee in the present case is an individual who is a Proprietor of M/s Prasad Shipping Co. and is also a Director in Sri Radhakrishna Shipping Pvt. Ltd. The return of income for the year under consideration was filed by him on 30-102006 declaring a total income of ₹ 5,24,420/-. During the course of assessment proceedings, it was noticed by the AO from the details and documents furnished by the assessee that expenses aggregating to ₹ 14,44,354/- incurred by the assessee through his credit cards were paid by M/s Sri Radhakrishna Shipping Pvt. Ltd. He, therefore, required the assessee to explain as to why the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s preferred by the assessee before the learned CIT(Appeals) and the submission made before the AO was reiterated on his behalf before the learned CIT(Appeals). It was also submitted that the addition made by the AO on account of perquisite value would amount to double taxation as the expenses in question were covered by fringe benefit tax and the employer company had paid fringe benefit tax on the expenses incurred by the assessee through his credit cards and paid for by the said company. 4. The learned CIT(Appeals) did not find merit in the submission made on behalf of the assessee on this issue and rejecting the same, he confirmed the addition of ₹ 14,44,354/- made by the AO on account of value of perquisite to the total income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ypur Minerals Development Pvt. Lt. 269 ITR 263 bear special mention in this regard. On this, the appellant has argued that the bills being computer generated could not be preserved for long to be produced as evidence. The argument is hollow as the papers on which computer generated bills are prepared are equally durable as bills otherwise prepared. There is therefore, no reason why they could not be preserved. This apart, I also fail to see any reason why the appellant would be made to purchase these items through his credit cards when the company could have easily bought the items out of its own funds either in cash or through cheque. As is well known, companies buy gift articles in bulk and not in piecemeal fashion as has been done by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar ground for the assessment years 2001-02 to 2005-06 vide his order dt. 22.5.2007. Facts remaining the same, I agree with my predecessor on his reasoning confirming the additions. In the light of the foregoing, I find that the expenses in question have been rightly treated as perquisites in the hands of the appellant u/s 17(2)(iv) of the ITA. As may be seen, the expenses incurred do satisfy the conditions stipulated in the clause (iv) of sub section 2 of section 17. Accordingly, the addition is confirmed and the ground of appeal is dismissed. The Assessing Officer is at the same time directed to verify the appellant s contentions on the double additions and on ₹ 51,510/- being relatable to assessment year 2005-06 and modify the disal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the employer has incurred expenses for any of the purposes referred to in the relevant provisions and there is no requirement to segragate such expenses between those incurred for official purposes and personal purposes. It was further clarified while answering question No. 81 that when expenditure on running and maintenance of motor cars is liable to fringe benefit tax, the employees will not be liable to income tax on the perquisite value of motor car provided by the employer. As rightly contended by the learned counsel for the assessee, circular No. 8/2005 dated 29-08-2005 issued by the Board explaining the provisions relating to fringe benefit tax thus makes it clear that although fringe benefit tax is recovered from employer, the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the submission of the assessee and it is noticed that M/s Radhakishan Shipping Pvt. Ltd., the employer of the assessee has already considered the aggregate amount of ₹ 1,72,650/- while offering the value of FBT and has paid tax of ₹ 11,737/- on ₹ 34,530/- under the Fringe Benefit Tax. The balance amount of ₹ 1,38,120/- (1,72,650 34,530) 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. 6. Keeping in view the Board Circular No. 8/2005 dated 29-08-2005 as discussed above and the stand taken by the AO himself on the similar issue in assessee s own case for the subsequent years i.e. assessment years ..... X X X X Extracts X X X X X X X X Extracts X X X X
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