TMI Blog2020 (1) TMI 990X X X X Extracts X X X X X X X X Extracts X X X X ..... ly liable u/s. 115WA(1). We may also clarify that inasmuch as the assessee was not heard on said denial (toward TDS) on the provision of free/concessional electricity to its employees for their household consumption, we are not issuing any final finding in the matter. Our decision rests on the premise that the said denial would render it liable to FBT u/s. 115WA(1) inasmuch as it would effectively preclude it from raising the plea of the tax on the said benefit being payable by the employees. That is, it is not open for it to take a contrarian stand, as it apparently does inasmuch as it admits to neither the tax liability on the benefit to its employees and, consequently, to deduction of tax at source and the consequential liability u/s. 201(1)/201(1A), as well as to tax u/s. 115WA(1). In fact, it does not admit to FBT even in respect of the employees not covered u/s. 17(2)(iii), i.e., on which the plea of the tax being payable by the employee is, even de hors s. 192, not applicable. Assessee's appeal dismissed. - ITA No.71/JAB/2016 - - - Dated:- 20-1-2020 - Shri Bhavnesh Saini, Judicial Member And Shri Sanjay Arora, Accountant Member For ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he provision of free electricity by the assessee to its employees during the relevant year, i.e., f.y.2007-08, valued at ₹ 2,78,68,642. The assessee s stand is that the same is a perquisite in the hands of the employees, forming part of their salary income and, therefore, excluded under FBT (s.115WB(3)). Tax on the said perquisite, however, had not been deducted at source as its employees had contested the same before the Hon ble High Court, which matter is sub-judice. There is no interim order by the Hon ble High Court admitting a question of law, or in exercise of its writ jurisdiction, on record to support the claim of the matter being subjudice. There is in fact no reference to any such order or injunction by the Hon ble High Court in any pleading by the assessee at any stage, including the statement of facts forming part of the appeal memo (in Form 36). A perusal of the order by the Tribunal for AY 2006-07, as well as the assessees petition before the Hon ble High Court following the Tribunal s order for that year, though reveals that the employees of Madhya Pradesh State Electricity Board (MPSEB)(a Department of the State Government of Madhya Prades ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court with reference to the decision by the Apex Court in Arun Kumar (supra). We find no deviation from the clear position of law, i.e., of the same being a perquisite in respect of the employees specified under subclauses (a), (b) and (c) of s. 17(2)(iii). The next question is if tax has been paid by the concerned employees thereon ? Clearly not, and neither is there any contention to this effect at any stage; the only plea raised being of the identity of the fact situation and of the law, i.e., as for AY 2006-07, and the non-deduction of tax at source, as for that year, being on account of the matter being subjudice which, as apparent from the Tribunal s order for that year, it is not. The non-discharge of the tax liability on the said benefit by the employees, or on their behalf by the assessee, is understandable, as otherwise the question of levy of FBT thereon on the assessee does not arise (s. 115WB(3)). 3.3 TDS is a mode of payment of the tax liability of the payee-deductee by the payer-deductor by deducting the same at source. This liability gets fastened on the payer u/s. 4(2) read with the relevant provision of Chapter XVII of the Act, so that it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e being regarded as a perquisite and, thus, the tax liability thereon. There is no such contention by the assessee, i.e., of the tax on the said perquisite having been paid or admitted as payable by the employees, in which case, where so, it indirectly admits to a default qua non-deduction of tax at source by it inasmuch as there is no injunction by the Hon ble Court even as there is no estopple against law (refer para 3.3). In sum, a benefit for its exclusion under FBT u/s.115 WB (1), must be a perquisite and, two, tax in respect of which has been paid or is payable by the assessee, i.e., on their behalf of the concerned employees. How could the assessee, we wonder, then contend that the employees benefit be regarded as a perquisite in respect of which tax is paid or is payable by the concerned employees ? Does it, one may ask, admit to a default u/s. 201(1)/201(1A)? This is any such contention would fasten it with the tax liability u/s.192 r/w s. 4(2), for the deposit of which there is no time limit, i.e., for the relevant year. That is, it is an either/or situation for the assessee, who can t have it both ways, excluding it from charge of FBT as well as tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x payable on the perquisite to its employees, is, however, in view of s. 192 r/w s.4, by the assessee-employer, i.e., by and on behalf of the employees, and which it has not, and neither have the employees admittedly paid tax thereon. It is therefore not open for it to contend, as it does before the Hon ble High Court, that the same is a perquisite on which tax is payable by the employees, saving it from being charged under FBT on the said benefit. That is, it cannot take refuge in its own default in pleading for a saving from another liability, so that one becomes an excuse for the other . This is particularly considering that the law itself contemplates of a liability under either, so that there is no scope for escape from tax liability under both. The raising of such a plea is even otherwise not maintainable inasmuch as it is impermissible for one to, in seeking an exclusion or exemption, take advantage of one s own default or wrong (see, inter alia, B.M. Malani v. CIT [2008] 306 ITR 196, 207 (SC)). In fact, any such contention, i.e., of the tax being payable on the said perquisite chargeable u/s. 17(2), even if made now (for the current year), retra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , that the ld. counsel omitted to refer thereto while making his arguments or presenting his case. 4. We, for the foregoing reasons, decline interference, and are of clear view that only an acceptance of it s liability to deduct and deposit income-tax on the perquisite to its employees and, rather, doing so, would operate to save the assessee of it s liability to tax u/s.115WA(1). The facts of the case are admitted and borne out by the record, being admittedly the same as for AY 2006-07, as is the position of law for both the years. The assessee does not admittedly accept its liability to deduct and deposit tax at source on the said benefit. It is accordingly liable u/s. 115WA(1). We may also clarify that inasmuch as the assessee was not heard on said denial (toward TDS) on the provision of free/concessional electricity to its employees for their household consumption, we are not issuing any final finding in the matter. Our decision rests on the premise that the said denial would render it liable to FBT u/s. 115WA(1) inasmuch as it would effectively preclude it from raising the plea of the tax on the said benefit being payable by the employees. That is, it is no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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