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TMI Blog1983 (5) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... n advertising and publicity business. He was already a member of the Bombay Gymkhana Club since 1960. During the year under consideration, the assessee became the life member of Willington Sports Club, by paying a sum of Rs. 25,000. The case of the assessee was that it would take a very long time to become an ordinary member and so he had to become the life member by paying a sum of Rs. 25,000. Further, it was in the interest of the business carried on by the company that he had to become a member, and so, the membership fee of Rs. 25,000 was paid by the employer-company. The assessee, therefore, urged that being a life member of the Willington Sports Club was not a benefit or amenity accruing to him, as it was wholly and exclusively meant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rts Club did not confer any amenity or benefit to the assessee. Further, he pointed out that the expense under consideration has been allowed in the file of the company by the Commissioner (Appeals) and the Tribunal in the case of the company has held the same to be an expense incurred wholly and exclusively for the business carried on by the company, as per their order dated 8-3-1983 in IT Appeal No. 3404 (Bom.) of 1981. He pointed out that the ITO did not invoke either section 40(c) or section 40A(5) of the Act in the case of the company, which fact showed that the expense under consideration was not considered by the ITO to be a perquisite for the purpose of those sections in the assessment made on the employer-company. Taking us through ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Willington Sports Club, namely, from Rs. 96.25 lakhs in 1974-75 to Rs. 270.22 lakhs in 1978-79. 5. Shri G. Krishnan, the learned representative for the department, on the other hand, supported the orders of the revenue authorities. He took us through the language of section 17 and urged that the definition of the term 'perquisite' given in section 17(2) enlarges the ordinary meaning of salary so as to include the amenity or benefit provided by the employer to an employee who is a director. He stated that in a place like Bombay, being a member of a prestigious club like Willington Sports Club did result in a personal benefit to the person who became a life member of the said club. He stated that the assessee could leave the company and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it or amenity to the assessee. We do not find any evidence on record to suggest that the assessee became a member of the second club for any purpose other than the furtherance of the business interests of his employer-company. Secondly, there is force in the contention that the ITO has not invoked the provisions of section 40(c) or section 40A(5) in the case of the company, which fact evidently shows that he did not consider this expenditure as a perquisite at all. Hence, it is not open to the department now to turn round and say that the same amount is perquisite. Thirdly, the Tribunal in the case of the company has held that the expenditure under consideration was spent wholly and exclusively for the purpose of the business carried on by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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