9911796707
TMI Blog2017 (1) TMI 1701X X X X Extracts X X X X X X X X Extracts X X X X ..... of appeal:- "1. For that the Ld. CIT (A) has erred in upholding the action of the Assessing Officer in initiating proceeding u/s 115WG / 115WH of the Income-tax Act. 2. For that the Ld. CIT (A) has erred in holding that the value of free samples of medical formulation distributed to doctors and others has escaped assessment within the meaning of section 115WG & 115WH. 3. For that the Ld. CIT (A) has erred in holding that the non-inclusion of the value of FBT on account of distribution of free samples of medical formulations to doctors and others by the then Assessing Officer passing order u/s 115WE(3) dated 25/11/2008 was a mistake and hence the initiation of the present proceeding u/s 115WG & 115WH is not vitiated. 4. For that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribution of free samples of medical formulations to doctors & others is wrong, illegal and unjustified on the facts and in the circumstances of appellant's case. 13. For that the whole order is bad in law and fact of the case and is fit to be quashed." 3. Although there are multiple Grounds of appeal raised, but the singular substantive dispute revolves around the action of Assessing Officer in including a sum of Rs. 4,01,40,143/- representing free samples distributed for the purposes of charging Fringe Benefit Tax (FBT). 4. In brief, the relevant facts are that originally the assessee filed a return of FBT disclosing the value for FBT to the extent of Rs. 5,41,64,140/-, which was subject to an assessment in terms of Sec. 115WE(3) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in further appeal before us. 5. Before us, as the Grounds of appeal reveal, various arguments have been raised by the assessee. The preliminary Ground raised is that the initiation of proceedings u/s 115WG & 115WH of the Act was illegal inasmuch as the reopening is based on a mere change of opinion. On merits of the addition also, assessee has pointed out that the action of the Assessing Officer is untenable and one of the arguments raised was based on the judgment of Hon'ble Bombay High Court in the case of Tata Consultancy Services Ltd., 374 ITR 112 (Bom.). 6. On the other hand, the ld. DR has relied upon the reasoning adopted by the Assessing Officer, which we have already adverted to in the earlier paras and is not being repeated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ling under the head 'sales promotion' and he allowed the claim of assessee that such amount was not includible for the purposes of FBT. The said stand of CIT(A) was upheld by the Tribunal, which has been affirmed by the Hon'ble High Court. In the said case, it was noticed that expenditure by way of subscription had been incurred in terms of contractual agreement between Tata Consultancy Services Ltd. and Tata Sons and that there was no employer-employee relationship between the two. The Hon'ble High Court observed that the basis of FBT is the benefit or perquisite which emanates out of employer-employee relationship. As a consequence, it is safe to deduce that in order to justify the levy of FBT, establishing of employer-emplo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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