TMI Blog2013 (7) TMI 254X X X X Extracts X X X X X X X X Extracts X X X X ..... inesh Vyas ORDER Per P. M. Jagtap, A.M. This appeal is preferred by the Revenue against the order of the ld. CIT(A) - 6, Mumbai dated 20-01-2012 and in the solitary ground raised therein, the Revenue has challenged the action of the ld. CIT(A) in holding that the expenses of Rs. 16.52 crores incurred by the assessee on account of sale promotion cannot be charged under Fringe Benefit Tax (FBT). 2. The assessee in the present case is a company which is engaged in the business of generation, purchase, transmission and distribution of electricity. The return of income for the year under consideration was originally filed by the assessee on 3-9-2008 which was subsequently revised on 26-3-2010. In the revised return, the total value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pect of Brand Equity as the same did not result in any benefit to employee of the assessee either directly or indirectly. Aggrieved by the order of the ld. CIT(A) the Revenue has preferred this appeal before the Tribunal. 4. At the time of hearing before us, the ld. representatives of both the sides have agreed that the issue involved in this appeal of the Revenue is squarely covered in favour of the assessee by the decision of the co- ordinate Bench of the Tribunal in the case of ACIT vs. Tata Motors Ltd., another group concern, rendered vide its order dtd. 23-11-2012 in ITA No. 8297/M/2011 for A.Y. 2008-09 wherein a similar issue has been decided by the Tribunal in favour of the assessee for the following reasons given in para No. 5 to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... FB value declared by the assessee-company. As far as values of brand promotion expenses are concerned they cannot be treated as FB to the employees. In Circular No.8 dated 29.8.2005, CBDT has clarified that for levy of FBT employer-employee relationship is the basic condition. In the case under consideration payment had been paid to another group concern. Thus, there is no direct or indirect benefit has accrued to the employees of the appellant company. Therefore, in our opinion, FBT cannot be levied on brand promotion expenses. Cases relied upon by the AR also support the submissions made by him. Respectfully following the decisions delivered by the Bangalore and Mumbai Bench of the Tribunal in the cases M/s Toyota Kirloskar Motor P. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enefit by the employees is missing. Therefore, Fringe Benefit Tax would not be leviable unless benefit accrues collectively to the employees of the Assessee. We, therefore, find no merit in Ground No. 3 raised by the Revenue. Consequently, Ground No.3 raised by the Revenue is dismissed". 7. From the above judicial pronouncements, it is evident that the expenditure on account of sales promotion cannot be brought under FBT provisions as they are not incurred by the employees of the company. Therefore, para 5.2 of the impugned order also justifies that the FBT cannot he levied except in respect of payments made for the beneficial to the employee directly or indirectly. In the present case, the expenditure being for the sales promotion, the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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