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2014 (5) TMI 80 - AT - Income TaxAddition on account of fringe benefit value - Validity of clubbing of grounds – 8 grounds on FBT taken by the assessee on various expenses - Interpretation of Sections 115WA and 115WB of the Act – Whether for applying the provisions of Chapter XII-H of the Income-tax Act pertaining to bringing to the charge of tax the value of fringe benefits in the hands of the employer, employer - employee relationship is a prerequisite - Held that:- It is not possible to permit any segregation - it would be in the fitness of things if the assessees are directed to deposit the amount of Fringe Benefit Tax as per installment in a separate account to be opened and maintained with a Scheduled Nationalized Bank, subject to the condition that the amount so deposited shall not be utilized by the assessee in any manner whatsoever for any purpose, no charge shall be created nor shall the said account be used or permitted to be used as a collateral for obtaining any loan against the same. Upon such deposit being made in separate bank account and production of the necessary proof of such deposit before the Income-tax department, it shall amount to sufficient compliance qua the provisions of the Act levying Fringe Benefit Tax - the authorities below are not justified in making the addition - the order passed by the CIT(A) is not justified and also the AO was not justified in making the addition - the assessee itself has made the submission that the amount has been deposited in Escrow account in pursuance to the direction – the AO is directed to verify whether the assessee has deposited the amount and delete the addition – Decided in favour of Assessee.
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