TMI Blog1993 (9) TMI 68X X X X Extracts X X X X X X X X Extracts X X X X ..... s. Gem Palace, Jaipur. The firm had taken on lease Bairathi Bhawan at M. I. Road, Jaipur. The premises were remodelled at the cost of Rs. 1,98,890 up to Diwali, 1976. One-third of the premises is occupied by the assessee which is free of rent. The assessee offered to the Income-tax Officer an amount of Rs. 4,000 to be assessed in his hands on this account. The Income-tax Officer did not accept this amount offered and included the benefit in the hands of the assessee at Rs. 9,000. The reason was that in the previous year, though the figure of Rs. 4,000 was taken because of renovations and investment of around Rs. 2 lakhs, which were spent by the firm, this amount was increased to Rs. 9,000. In the appeal before the Appellate Assistant Comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usiness or the exercise of a profession. " From the above provision of law, it would be evident that the value of any benefit or perquisite whether converted into money or not, if it arises out of business or profession, is chargeable to tax and the only thing which has to be seen is that there must be direct nexus between the business and the benefit which has been derived. In V. P. Warrier v. CIT [1990] 181 ITR 303 (MP), relying upon the decisions of the apex court in CIT v. P. M. Muthuraman Chettiar [1962] 44 ITR 710 and CIT v. Ramniklal Kothari [1969] 74 ITR 57, it was held that if the firm has allowed use of the residential premises to its partner, the Income-tax Officer can include the value of the perquisite in the income of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich it could be taxed has not been mentioned. The authorities are expected to know the law and even if, for any reason, the provision has not been mentioned in the assessment order, it was their duty to consider the provisions of the Act, more particularly when, in the assessment order, it was mentioned that it is an advantage derived by the assessee from the firm, Messrs. Gem Palace, which was estimated at a figure of Rs. 9,000 and for which the reason was also given in the assessment order. It is also to be noted that, in the previous years, the amount of Rs. 4,000 was included in the income of the assessee on this account and in the relevant assessment year, the said figure was offered by the assessee himself in writing. The amount was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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