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2013 (6) TMI 569 - ITAT MUMBAIFBT on expenses incurred on non- employees - Held that:- As decided in CIT Vs Tata Consultancy Ltd. [2013 (6) TMI 516 - ITAT MUMBAI] employer/employee relationship is a pre-requisite for the levy of fringe benefit tax. Thus as no employer-employee relationship exists with non- employees payment deserves to be kept out side the purview of FBT. In favour of assessee. FBT on fringe benefit which are taxable in the hands of employees - Medical reimbursement & Medical facilities - Held that:- As decided in case of Vijaya Bank [2011 (8) TMI 751 - ITAT BANGALORE] where perquisites/benefits which are fully attributable to the employee and are taxed in their hands, would be continued to be taxed under the existing provisions of Sec. 17(2) of the Act. In the present case, these two items are directly attributed to the personal benefit of the employees therefore deserves to be kept outside the purview of fringe benefit tax. The other three items i.e. education facilities, maintenance of residential colony for employees and Insurance premium paid by employer to keep in force an insurance on health of employees are all perquisites liable to be taxed in the hands of the employees individually thus deserves to be kept outside the purview of FBT. In favour of assessee. FBT on administration expenses incurred on driver/pilot - Held that:- Expenses on repair, running and maintenance of motor car/aircraft do not include remuneration paid to drivers/pilot as supported by the decision of CIT Vs Sholinger Textiles Ltd. [1998 (4) TMI 83 - MADRAS High Court] - exclusion of value of such fringe benefit from the taxable value of fringe benefit. In favour of assessee. FBT on Insurance premium for motor car and aircraft - Held that:- As decided in CIT Vs Tungabhadra Industries Ltd [1991 (11) TMI 6 - CALCUTTA High Court] expenditure incurred on repairs and insurance of car cannot be considered for disallowance u/s. 37(3A) - exclusion of value of such fringe benefit from the taxable value of fringe benefit. In favour of assessee. FBT on pre-operative expenses - Held that:- CBDT in its explanatory note on the provisions relating to FBT answered that expenditure on any capital asset in respect of which depreciation is allowable u/s. 32 does not fall within the scope of sub-sec. (2) of Sec. 115WB. Since the approximate objective of incurring such expenditure is the acquisition of a capital asset therefore, such expenditure is not included in reckoning the value of fringe benefit - exclusion of value of such fringe benefit from the taxable value of fringe benefit - In favour of assessee. FBT on expenses on maintenance of residential accommodation not in the nature of guest house - Held that:- As decided in assessee's own case where the buildings have been used by the employees and other related visitors such as customers, surveyors, contractors, government officials, auditors etc., cannot be considered as guest house as they are connected with assessee's business - exclusion of value of such fringe benefit from the taxable value of fringe benefit - In favour of assessee. FBT on presentation articles distributed to business related persons - Held that:- As these expenses are incurred on persons related to or connected with the business but are not employees exclusion of value of such fringe benefit from the taxable value of fringe benefit directed - In favour of assessee.
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