TMI Blog1998 (9) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... basis' and not on simple tax basis as envisaged under section 17(2) of the Income-tax Act, 1961 ?" The reference has been made at the instance of the assessee relating to the assessment year 1984-85. Shortly stated the facts are : The assessee in this case is a foreigner who worked as a technical advisor to Yuken India Ltd., Bangalore. As per the terms of his employment, he was to be paid a fixed amount of net salary and the tax component was to be borne by his employer. The employer paid income-tax of Rs. 34,306 on behalf of the assessee. The Income-tax Officer framed the assessment and determined the taxable income at Rs. 83,554. The Income-tax Officer made the calculations as under while determining the taxable income of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for short, "the Act"). In response to the notice issued, the assessee put in appearance and objected to the proposed order. The Commissioner of Income-tax, overruling the objections raised by the assessee, held that the order of the Income-tax Officer was erroneous and prejudicial to the interests of the Revenue on account of the omission on the part of the Income-tax Officer to treat the amount of tax paid by the employer of the assessee as income-tax as a perquisite and his failure to gross up the salary for the purpose of taxation. He directed the Income-tax Officer to modify the assessment order made by him and to arrive at the correct income by taking into consideration the principle of grossing up the salary. The assessee filed an a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee. As per agreement, the assessee received a sum of Rs. 76,546 as his net salary to which the perquisites were to be added. His tax liability was to be determined after adding the value of the perquisites to the salary paid to him. As is clear from the order of the Income-tax Officer, the salary paid to the assessee from October 9, 1983, to March 31, 1984, was Rs. 76,546 to which the value of perquisites such as house, furniture, profession tax, gas, water, electricity and servant allowances were added to arrive at the gross salary of Rs. 89,554. After giving the benefit of standard deduction of Rs. 6,000 under section 16 of the Act, the taxable income was arrived at Rs. 83,554. It has been conceded before us that the amount of Rs. 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
