9911796707
TMI Blog2007 (7) TMI 261X X X X Extracts X X X X X X X X Extracts X X X X ..... as not justified in holding that reimbursement of medical expenses in the form of payment represented a 'benefit' liable to tax” – held that cash payments towards medical reimbursement not comes in scope of Section 2(24)(iv) - 82 to 85 of 1986 - - - Dated:- 3-7-2007 - MADAN B. LOKUR and V.B. GUPTA JJ. Rajan Bhatia, for the assessee. P. L. Bansal, for the Commissioner. JUDGMENT T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed by learned counsel for the assessee and, therefore, we return it unanswered. 3. Questions No.2 and 3 arise from the fact that the assessee had incurred certain expenses for his medical treatment and the expenses were reimbursed to him in cash by his employer. According to the Revenue, this represented a benefit derived by the assessee and was his income within the meaning of Section 2(24)( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aforesaid sections and were, therefore, deductible expenditure. The Supreme Court noted that the words "whether convertible into money or not" occurring in Section 40(a)(v) and Section 40A(5) of the Act clearly postulate expenditure other than by way of cash payment. 6. According to learned counsel for the assessee, Section 2(24)(v) of the Act also uses the expression "whether convertible int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . These words were also the subject matter of interpretation by the Supreme Court in Mafatlal Gangabhai and Co. (P) Ltd., (1996) 219 ITR 644, because similar words appear in Section 40(a)(v) and Section 40A(5)(a)(ii) of the Act. The Supreme Court asked the question what these words mean and answered it by saying that (page 654) :- "The said words contemplate a situation where the assessee m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mafatlal Gangabhai and Co. (P) Ltd., (1996) 219 ITR 644, we are of the opinion that this contention of learned counsel for the Revenue must be rejected and it must be held that cash payments made directly to the assessee fall outside the scope of Section 2(24)(iv) of the Act. 10. Under the circumstances, we answer questions No.2 and 3 in the negative, in favour of the assessee and against ..... X X X X Extracts X X X X X X X X Extracts X X X X
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