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Order u/s.254(1)of the Income-tax Act,1961(Act) Per Rajendra, A.M.लेखा सद�य राजे�� के अनुसारः Challenging the order dated 09.9.2011 of the CIT(A)-2 Mumbai,the Assessing Officer (AO) has filed the present appeal. Assessee-company,engaged in the business of Life Insurance and Annuity filed its Fringe Benefit (FBT)Return on 28.09.2008,declaring the value of Fringe Benefits(FB)at Rs.4.14 crores.Vide his order,dt.30.11.2010,the AO determined the value of the FB at Rs.7.62 Crores,u/s.115WE(3)of the Act,.While completing the assessment,he included the value of telephone/fax/telex-expenses(Rs.67.08lacs)and conveyance expenses(Rs.1.88 crores)for calculating the total value of FB. 2.Aggrieved by the order of the AO,the assessee preferred an appeal before the First Appellate Authority.(FAA).Before him,it was argued that identical issues were decided in favour of the assessee by the FAA in the earlier AY.s.,that both the expenditure were outside the ambit of FBT.After considering the submission of the assessee and the orders of his predecessors for the AY.s.2006-07 and 07-08,he held that the expenditure on office telephone and conveyance could not be treated as FB.Finally,he allowed the appeal filed by the assessee. 3.Before us,the Departmental Representative(DR) stated that the matter could be decided on merits. Authorised Representative (AR) relied upon the order of the Tribunal for AY 2006- 07(ITA No.63/Mum/2010 & 491/Mum/2010 dt.25.11.2011). We find that in the assessee’s own case the Tribunal has decided the issue in favour of the assessee while adjudicating the appeal for the AY 2006-07(supra).We would like to reproduce the relevant portion of the order and same reads as under : “11. In the result, assessee’s appeal is allowed for statistical purposes. Revenue’s appeal in ITA no.63/Mum./2010 Ground no.1, reads as follows:- “On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in deleting the fringe benefit tax levied on telephone / fax expenses in respect of telephones installed in the office premises ignoring the provisions of section 115WC(c) of the Act.”
The Commissioner (Appeals) held that the expenditure incurred on office telephones is not considered for employment. We uphold the conclusion of the Commissioner (Appeals), vide Para-13 of his order which is reproduced below, holding that no benefit flows to the employee by reason of his employment as far as expenditure on office telephone is concerned. “13. In the light of the above background I am constrained to conclude, even within the framework of deeming provisions, that:
1. 1. the phrase “consideration for employment” occurring in Subsection 1 of Section 11 5WB has not been superseded by the deeming provision contained in Sub-section 2 of the said section (except where specifically provided as in Clause B of Sub-section 2). 2. a benefit to employees, collective or may be individual, must necessarily be associated or be inherent for the expenditure to be treated as fringe benefit. In the absence of any inherent benefit to employees, even under the deeming provisions, fringe benefit cannot be assumed.
3. Deeming provisions contained in Sub-section 2 of Section 115 WB cannot be invoked mechanically and, in respect of every item of expenditure, it is necessary first to associate the benefit to employees arising out of their employment before the expenditure can be categorized to be resulting into fringe benefit, the exception of Clause B of Sub-section 2 of Section 115 WB notwithstanding. One can not., by the nomenclature alone, classify an expenditure to result into fringe benefit.” Consequently, we dismiss ground no.1, raised by the Revenue.
13. Ground no.2, reads as follows:- “2. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in deleting the fringe benefit tax levied on the conveyance including car hire charges ignoring the provisions of section 115WC(c) of the Act.”
14. The Commissioner (Appeals) held that the expenditure under consideration are day-to-day local travelling expenditure and taxi hire charges for movement of employees during their working hours. It is not conveyance expenses paid to the employee for travel between his residence and office. Under these circumstances, we uphold the findings of the Commissioner (Appeals) that the payment is not considered for employment. Thus, we dismiss ground no.2, raised by the Revenue.
15. In the result, Revenue’s appeal is dismissed.” Respectfully,following the above effective grounds of appeal filed by the AO are decided against him. As a result appeal filed by the AO stands dismissed. फलतः िनधा�रती अिधकारी �ारा दािखल क� गई अपील नामंजूर क� जाती है Order pronounced in the open court on 29th October, 2015. आदेश क� घोषणा खुले �यायालय म� �दनांक 29 अ�टूबर,2015 को क� गई । Sd/- Sd/- (बीना िप�लई / Beena Pillai ) (राजे�� / Rajendra) �याियक सद�य/Judicial Member लेखा सद�य/Accountant Member मुंबई Mumbai, �दनांक Date:29.10.2015 व.िन.स.Jv.Sr.PS. 2