9911796707
TMI Blog2013 (2) TMI 325X X X X Extracts X X X X X X X X Extracts X X X X ..... of uniform, stitching charges, washing expenses, etc. made to its employees and was called upon to pay the tax allegedly short deduced from its employees u/s 201(1) and interest thereon u/s 201(1A) of the Income Tax Act, 1961. 4. At the time of hearing both the parties agreed that issue is now covered in favour of the assessee and against the Revenue by the decision of the Tribunal in assessee's own case for the A.Y. 2009-10 vide ITA No.184/Ahd/2010 dated 16.11.2012 wherein on identical facts following was held:- "11. In view of our above discussion and in view of this fact that FBT was actually paid by the assessee-company on the impugned expenditure on uniform, washing allowance etc., the same cannot be considered as perquisites in the hands of the employees and therefore, there is no liability of the assessee-company to deduct TDS therefrom. 12. Now, we examine the applicability of CBDT Circular No.8 of 2005 dated 29-08-2005 (supra). From the relevant question of this Circular i.e., question No.74 as per which, the question was as to whether FBT is payable on a expenditure incurred on providing safety shoes or uniforms or equipments to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iable to income tax in the hands of the employee because the same cannot be considered as perquisites as per the provisions of section 17(2)(vi) of the Act. Once we come to this conclusion, it is abundantly clear that no TDS is required to be deducted by the employer from such expenditure incurred by the employer for the benefits of the employees. Accordingly, in the present case, we hold that TDS was not required to be deducted by the assessee-company from this expenditure incurred by it on providing uniform, washing charges and washing allowance etc. So this ground of assessee's appeal is allowed." 5. Respectfully following the above, this ground of the assessee is allowed. 6. Now coming to the appeal filed by the Revenue. 7. Ground No.1 which is common in all these appeals, except the amount, reads as under:- "The ld. CIT(A) erred in law as well as facts of the case in deleting the order passed u/s 201(1) & interest charged u/s 201(1A) of the I.T. Act of Rs.1,03,35,957/- and Rs.55,29,721/- respectively, for AY 2006-07 by the Assessing Officer even though during the course of verification it was noticed that the assessee company was paid conveyance, mainten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sement once every year towards the cost of insurance incurred by them on the vehicles for which they have been allowed to claim CMRE. This reimbursement is allowed on production of receipt for payment of insurance premium and copy of insurance policy/cover note etc., Restrictions on payments when employees were on leave or absent from duties for more than 30 days and 60 days reveal that the contention of the AO that even when the vehicles were not used, the CMRRE was paid falls flat. There is a considerable merit in the submissions of the appellant that when the employees are on onshore duty for longer periods, then expenses like insurance, maintenance expenses etc., are necessary to be reimbursed to employees coming under the scheme is acceptable. Even though may checks and balances were in vogue like selection of the employees coming under this scheme, procedure for reimbursements online claim by the employees etc. is there, for any shortcomings committed by the employees, the employee cannot be found fault with, rather it is for the AO assessing the employees to find out the correctness of the claim and in case of any default to take appropriate action. The fact that the employe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of fact that whether they stayed in hotel or made own arrangement of stay. ACIT (TDS) was of the view that the payment under Holiday Home Scheme was purely for non official and private purpose and was in the nature of salary of the employee taxable u/s.17(1)(iv). It was not exempt u/s 10(14) and could not be considered to be fringe benefit u/s 10(14). ACIT (TDS) held that payment of FBT on this amount did not imply any concession to the appellant who had failed to discharge obligation of deducting tax at source." 12. In appeal ld. CIT(A) decided the issue in favour of the assessee and now the Revenue is in appeal before us. 13. At the time of hearing ld. counsel of the assessee relied on the order of ld. CIT(A) while ld. D.R. relied on the order of the A.O. 14. After hearing both the parties and perusing the record, we find that ld. CIT(A), while giving relief to the assessee has observed as under:- "During the period, when FBT was applicable, appellant considered reimbursements to employees under holiday home scheme to be liable to FBT under section 115WB(2)(G), i.e. expenditure for use of hotel, boarding and lodging facilities. During the FBT regime, expe ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
