Punj Lloyd Ltd., New Delhi V. Addl. CIT, New Delhi

ITA 1010/DEL/2011

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0168 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 5 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-07-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 08-07-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 23-02-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: VIKRAM SAHAY
• Assessee Lawyers: RUPESH J AIN
• Keywords: Business income; Depreciation; Competent authority; Revised return
• Section: 154; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : F NEW DELHI BEFORE SHRI G.C. GUPTA, VICE PRESIDENT AND SHRI J.SUDHAKAR REDDY ACCOUNTANT MEMB ER ITA NOS: 1009,1010/DEL/2011 AY : - 2007-08 PUNJ LLOYD LTD. VS. ADDL. C IT 17-18, RANGE 14, NEHRU PLACE NEW DELHI. NEW DELHI (PAN AAACP0305Q) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI RUPESH JAIN, ADVOCATE RESPONDENT BY :SHRI VIKRAM SAHAY, SR. DR DATE OF HEARING :08.7.2015 DATE OF PRONOUNCEMENT :29. 07.2015 O R D E R PER J.SUDHAKAR REDDY, ACCOUNTANT MEMBER THESE ARE APPEALS FILED BY THE ASSESSE E, DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A) XVII, NEW DELHI DATED 19.11.2010 FOR THE ASSESSMENT YEAR 2007-08, WHEREIN HE CONFIRMED THE LEVY OF FRINGE BENEFIT T AX U/S 115WE OF THE INCOME TAX ACT 1961 VIDE ORDER DATED 24.12.2009 AND HAS ALSO C ONFIRMED THE REJECTION OF THE APPLICATION FILED BY THE ASSESSEE U/S 154 OF THE AC T. THE FACTS OF THE CASE AND THE RELEVANT SECTIONS ARE BROUGHT OUT BY THE AO FROM PA GE 2 TO 4 OF THE ORDER WHICH IS EXTRACTED FOR READY REFERENCE:- VALUE OF FRLNGE BENEFITS ON ACCOUNT OF EXPENSES RE LATED TO AIRCRAFTS ITA NOS.1009, 1010/DEL/2011 PUNJ LLOYD LTD. VS ACIT 2 IN THE ORIGINAL RETURN, THE VALUE OF FRINGE BENEFIT S WAS DECLARED AT RS.11,29,71,006/- WHICH WAS SUBSEQUENTLY' REVISED BY FILING REVISED R ETURN TO RS.5,42,95,190/-. THUS, IN REVISED RETURN, THE VALUE OF FRINGE BENEFITS WERE R EDUCED BY AN AMOUNT OF RS.5,86,75,815/-. ON EXAMINING THESE RETURNS, IT WA S NOTED' THAT THE ABOVE DIFFERENCE IS ON ACCOUNT 'OF DIFFERENT VALUE OF FRI NGE BENEFITS ADOPTED FOR REPAIR, RUNNING (INCLUDING FUEL) AND MAINTENANCE OF AIR CRA FT AND THE AMOUNT OF DEPRECIATION THEREON. IN THE ORIGINAL RETURN, THE ASSESSEE ADOPT ED THE VALUE OF FRINGE BENEFITS @ 20% ON TOTAL EXPENDITURE OF RS.29,33,79,076/- INCUR RED FOR REPAIR, RUNNING (INCLUDING FUEL) AND MAINTENANCE OF AIRCRAFT AND THE AMOUNT OF DEPRECIATION THEREON. THUS, THIS VALUE WAS TAKEN AT RS.5,86,75,815/-. IN THE REVISED RETURN, THE ASSESSEE ADOPTED THE ABOVE VALUE AT RS. NIL. THIS CAUSED THE DIFFERENCE OF RS. 5,86,75,815/- IN VALUE OF FRINGE BENEFITS IN THE RETURN. THE ASSESSEE WAS ASK ED TO PROVIDE THE REASON FOR REVISING THE VALUE OF FRINGE BENEFITS. VIDE LETTER DATED 23.10.09, THE ASSESSEE SUBMITTED AS UNDER: ' 'IN THE ORIGINAL RETURN TILED, THE VALUE OF RS. 5,8 6,75,81S/- IN RESPECT OF REPAIR; RUNNING AND MAINTENANCE EXPENSES OF AIRCRAFTS HAD BEEN- WRO NGLY INCLUDED IN THE , ) TOTAL VALUE OF RS. 1 1,29,71,006/- BUT THE SAME SHOULD BE LIABLE FOR FET AT NIL RATE IN VIEW OF SECTION 115WC(2)(1) OF THE INCOME TAX ACT, 1961 SINCE THE ASSESSEE COMPANY, IN ADDITION OF OTHER BUSINESSES ACTIVITIES, IS ALSO IN THE BUSINESS OF CARRIAGE OF PASSENGERS OR GOODS' BY AIRCRAFT HOWEVER, THE EXPEN SES WERE TREATED AS PART OF FRINGE BENEFIT WHEN THE RETURN WAS ORIGINALLY FILED . SUBSEQUENTLY THIS WAS NOTICED AND THE RETURN WAS REVISED TO RECTIFY. ASSESSEE COMPANY HAS BEEN GRANTED LICENSE FOR OPERATING AIRCRAFTS FROM AIRPORTS AUTHORITY OF INDI A (COPY OF THE LICENSE IS BEING ENCLOSED HEREWITH.) IN PURSUANCE OF THIS LICENSE, T HE COMPANY IS OPERATING AIRCRAFT IN CHARTER BASIS FOR CARRYING PASSENGERS, IN ADDITION TO USAGE FOR COMPANIES BUSINESS PURPOSES. COMPANY UTIJIZES OPERATING AND MAINTENANC E SERVICES FROM DIFFERENT SERVICE PROVIDERS IN THIS BUSINESS. ALL THE EXPENSE S IN CONNECTION WITH PROVIDING AIRCRAFT ON CHARTER HIRE BASIS TO THIRD PARTIES IS BORNE BY THE COMPANY DDIRECT1Y OR BY WAY OF REIMBURSEMENT OF EXPENSES INCURRED BY THE SE RVICE PROVIDERS. ASSESSEE COMPANY GIVES AIRCRAFT ON CHARTER/HIRE BASIS TO THI RD PARTIES EITHER DIRECTLY OR THROUGH SERVICES PROVIDERS. EVIDENCE IN RESPECT OF OPERATIO N OF AIRCRAFT ON CHARTER HIRE BASIS IS ENCLOSED HEREWITH. BREAK-UP THE REPAIR, RUNNING AND MAINTENANCE EXPENS ES OF AIRCRAFT IS AS FOLLOWS: ITA NOS.1009, 1010/DEL/2011 PUNJ LLOYD LTD. VS ACIT 3 PARTICULARS TOTAL AMOUNT RATE FBT VALU E INCLUDE EXPENSES DEBITED 157641917/ - 20% 31528383 TO PROFIT AND LOSS ACCOUNT IN RESPECT OF REPAIR , RUNNING . AND MAI NTENANCE OF AIRCRAFT DEPRECIATION ON 160358306/ - - 20% 32071661 AIRCRAFT TOTAL EXPENSES 318000223/ - 63600044 INCOME FROM HIRING 24621147/ - 20% 4924229 OF AIRCRAFT NET EXPEN ES 293379076/ - 58675815 IN VIEW OF THE FACT THAT THE ASSESSEE COMPANY IS AL SO ENGAGED IN THE BUSINESS OF CARRIAGE OF PASSENGERS OR GOODS BY AIRCRAFT IT IS L IABLE TO FBT AT NIL RATE, IN RESPECT OF EXPENSES INCURRED ON REPAIR, RUNNING AND MAINTENANC E OF THE AIRCRAFT,. REVISED RETURN WAS ACCORDINGLY FILED' BEFORE DISCUSSING THE ISSUE FURTHER, IT. WOULD BE W ORTHWHILE TO DISCUSS THE PROVISIONS OF INCOME TAX ACT WITH REGARD TO COMPUTATION OF VAL UE OF FRINGE BENEFIT IN RELATION TO REPAIR, RUNNING (INCLUDING FUEL) AND MAINTENANCE OF AIR CRAFT AND THE AMOUNT OF DEPRECIATION THERE ON, AS PER SECTION I 1 5WB(2) (I ), THE EXPENDITURE INCURRED BY EMPLOYER FOR HIS EMPLOYEES ON REPAIR, RUNNING (INCL UDING FUEL) AND MAINTENANCE OF AIR CRAFT AND 'THE AMOUNT OF DEPRECIATION THEREON IS CO NSIDERED AS FRINGE BENEFIT. SECTION 115WC PRESCRIBES THE VALUE OF SUCH FRINGE BENEFITS, THE RELEVANT PORTION OF SECTION IS REPRODUCED BELOW: 115WC (1) - FOR THE PURPOSE OF THIS CHAPTER, THE VA LUE OF FRINGE BENEFITS SHALL BE AGGREGATE OF THE FOLLOWING NAMELY. , ... , . , . , , , , , . (C) 20% OF THE EXPENSES REFERRED TO IN CLAUSE (A) T O (K) OF SUB-SECTION (2) OF SECTION 11 S WB. SUB-SECTION (2) OF SECTION 11 SWC PROVIDES RELIED I N VALUE OF FRINGE BENEFITS UNDER CERTAIN CIRCUMSTANCES. CLAUSE (1)OF THIS SUB-SECTIO N (2) OF 11 SWC READS AS UNDER. (T) IN THE CASE OF AN EMPLOYER ENGAGED IN THE BUS INESS OF CARRIAGE OF PASSENGERS OR GOODS BY AIRCRAFT, THE VALUE OF FRING E BENEFITS FOR THE PURPOSES REFERRED TO IN CLAUSE (J) OF SUB-SECTION (2) OF SECTION 11 S WB SHALL BE TAKEN AS NIL . ITA NOS.1009, 1010/DEL/2011 PUNJ LLOYD LTD. VS ACIT 4 THUS , THE VALUE OF FRINGE BENEFITS ON REPAIR, RUNN ING (INCLUDING FUEL) AND MAINTENANCE OF AIR CRAFT AND THE AMOUNT OF DEPRECIA TION THERE ON WILL BE CALCULATED @ 20% IN NORMAL BUSINESS AND WILL BE TAKEN AT NIL I N THE CASE OF AN EMPLOYER, WHO IS ENGAGED IN THE BUSINESS OF CARRIAGE OF PASSENGERS O R GOODS BY AIRCRAFT. IN LIGHT OF ABOVE, THE ISSUE WHICH IS REQUIRED TO BE EXAMINED IS THAT WHETHER THE ASSESSEE CAN BE REGARDED AS ENGAGED IN THE BUSI NESS OF CARRIAGE OF PASSENGERS OR GOODS BY AIRCRAFT. THE ASSESSEE IS HAVING TWO AIRCRAFT - (1) HELICOPTER: MODEL BELL 206 L4. THE SAME WAS PU RCHASED IN THE YEAR 2004-05; (2) AIRCRAFT: MODEL GULF STREAM IV. THE SAME WAS A CQUIRED DURING THE F.Y.2006-07 . THUS, THE ASSESSEE WAS HAVING HELICOPTERS SINCE 200 4-05 AND IT PURCHASED ANOTHER AIRCRAFT DURING THE FINANCIAL YEAR UNDER CO NSIDERATION. FROM THE PAST RECORD, IT IS SEEN THAT THE ASSESSEE WAS REGULARLY OFFERING THE VALUE OF FRINGE BENEFITS IN RELATION TO HELICOPTER FOR TAXATION. HOWEVER; SUDDE NLY .DURING THE YEAR, THE ASSESSEE TOOK A DIFFERENT STAND, WHEN IT PURCHASED NEW AIRCR AFT 'AMOUNTING TO RS. 106.68 CRORE. ON EXAMINING THE INCOME FROM AIRCRAFT, IT IS NOTED THAT THE ASSESSEE HAS EARNED THE INCOME ON ACCOUNT OF HIRING OF THE AIRCR AFTS TO TWO PARTIES NAMELY KUBASE SOLUTIONS AND INDO-PACIFIC AVIATION LTD. THE INVOIC ES ISSUED FOR SUCH INCOME WERE ALSO EXAMINED. THESE INVOICES INDICATE THAT THE INCOME F ROM AIRCRAFT IS ON ACCOUNT OF CHARTER HIRE CHARGES RECEIVED FROM ABOVE PARTIES. T HUS, ASSESSEE IS EARNING INCOME FROM HIRING OF HELICOPTER AND AIRCRAFT. 2. THE ASSESSEEE CLAIMED BEFORE THE AO THAT IT IS ENGAGED IN THE BUSINESS OF CARRIAGE OF PASSENGER OR GOODS, BY AIRCRAFT AND HEN CE AS PER SECTION 115 WC (F) THE VALUE OF FRINGE BENEFIT TAX, FOR THE PURPOSES REFER RED TO IN CLAUSE (I) OF SUB SECTION (2) OF SECTION 115WE SHALL BE TAKEN AS NIL. THE AO AS WELL AS THE CIT(A) ANALYSED THE FACTS OF THE CASE AND HELD THAT THE ASSESSEE WA S USING THE AIR CRAFT FOR THE INTERNAL BUSINESS OF THE COMPANY AND THIS CONSTITUT ED MERELY 92.85% OF THE USAGE AND THAT THE AIR CRAFT WAS GIVEN ON HIRE ONLY FOR 7.15%. SIMILARLY IN THE CASE OF USAGE OF HELICOPTER, IT WAS FOUND THAT THE ASSESSEE WAS USING A HELICOPTER MAINLY FOR THE PURPOSE OF THE ASESSEES INTERNAL BUSINESS. THE RE IS ALSO A FINDING OF FACT THAT THE ITA NOS.1009, 1010/DEL/2011 PUNJ LLOYD LTD. VS ACIT 5 ASSESEE HAS NO DIRECT CONTACT WITH PASSENGERS AND T HE INCOME GENERATED WAS ONLY FROM HIRE CHARGES OR HIRE ON ESTIMATE BASIS. THE AS SESSEE RELIED ON THE OPINION OF M/S. VAISH ASSOCIATES ADVOCATES AND FILED A REVISED RETURN OF INCOME, CLAIMING EXEMPTION. ON FACTS THIS CONTENTION OF THE ASSESSEE WAS REJECTED BY THE ASSESSING OFFICER. 3. IN APPEAL BEFORE THE FIRST APPELLATE AUTHOR ITY, THE ASSESSEE REITERATED THE CONTENTIONS RAISED BY HIM BEFORE THE AO. IN ADDITIO N HE CONTENTED AS FOLLOWS :- WITHOUT PREJUDICE TO THE ABOVE, IT IS RESPECTFULLY SUBMITTED, THAT IN CASE IT IS HELD THAT GIVING AIRCRAFT ON CHARTER BASIS IS NOT AN ACT IVITY OF CARRIAGE OF PASSENGERS, THE AFORESAID EXPENSES TO THE EXTENT ATTRIBUTABLE TO TH E PERIOD OF HIRE ARE NOT LIABLE TO FRINGE BENEFIT TAX FOR THE FOLLOWING REASONS: IN TERMS OF SECTION 115WA OF THE ACT, AN ADDITIONAL TAX BY WAY OF FRINGE BENEFIT TAX IS PAYABLE IN RESPECT OF FRINGE BENEFITS PROVIDED OR D EEMED TO HAVE BEEN PROVIDED BY AN EMPLOYER TO ITS EMPLOYEES. SUB-SECTION (2) OF SECTI ON 115WB DEEMS CERTAIN EXPENSES INCURRED BY AN EMPLOYER AS RESULTING IN A FRINGE B ENEFIT TO AN EMPLOYEE, WHICH ARE SUBJECT TO FRINGE BENEFIT TAX AT THE VALUE TO BE DE TERMINED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 115WC OF THE ACT. IT IS RESPE CTFULLY SUBMITTED, THAT WHERE AN EXPENDITURE INCURRED DOES NOT CLEARLY RESULT IN ANY BENEFIT/FRINGE BENEFIT TO AN EMPLOYEE, NO PORTION THEREOF CAN BE DEEMED TO BE SU BJECT TO FRINGE BENEFIT TAX UNDER SECTION 115WB(2) READ WITH SECTION 115WC OF THE ACT . A CERTAIN PERCENTAGE OF THE EXPENDITURE INCURRED ON RUNNING, REPAIRING AND MAINTENANCE OF AIRCRAFT INCLUDING AMOUNT OF DEPRECI ATION THEREON, IS SUBJECT TO FRINGE BENEFIT TAX FOR THE REASON THAT THE POSSIBILITY OF THE AIRCRAFT HAVING BEEN USED FOR THE BENEFIT OF THE EMPLOYEES CANNOT BE RULED OUT AND IT IS NOT PRACTICALLY POSSIBLE TO WORK OUT THE BENEFIT DERIVED BY CERTAIN EMPLOYEES SO AS TO TAX THE SAME AS PERQUISITE IN HIS HANDS. IT IS RESPECTFULLY SUBMITTED, THAT IN A CASE WHERE THE AIRCRAFT IS NOT USED BY AN EMPLOYER IN ITS BUSINESS BUT IS LET ON HIRE AND IS UNDER THE POSSESSION AND CONTROL OF THE HIRER, THE POSSIBILITY OF USAGE OF THE AIRCRAFT BY THE EMPLOYEES OF THE OWNER OF THE AIRCRAFT IS OUSTED AND THERE CANNOT IN SUCH A SITUA TION BE ANY CASE OF BENEFIT BEING DERIVED BY THE EMPLOYEES FROM USE OF AIRCRAFT SO AS TO RESULT IN LEVY OF FRINGE BENEFIT TAX. THUS, DURING THE PERIOD WHEN AIRCRAFT IS USED BY THE HIRER, NO FRINGE BENEFIT IS DERIVED BY THE EMPLOYEES, WHICH CAN BE SUBJECTED TO TAX IN THE HANDS OF THE OWNER/EMPLOYER. ITA NOS.1009, 1010/DEL/2011 PUNJ LLOYD LTD. VS ACIT 6 IT MAY NOT BE OUT OF PLACE TO MENTION THAT THE ASSE SSING OFFICER IN THE ORDER PASSED UNDER SECTION 154 OF THE ACT HAS NOT REDUCED THE SU M OF RS.2,46,26, 147/- RECEIVED BY THE APPELLANT ON ACCOUNT OF CHARTER HIRE FROM THE E XPENDITURE INCURRED BY THE APPELLANT ON RUNNING, REPAIR, ETC., OF THE AIRCRAFT , FOR THE PURPOSES OF COMPUTING THE VALUE OF FRINGE BENEFITS LIABLE TO TAX, TREATING I T AS INCOME FROM BUSINESS OF HIRING. AS A COROLLARY THE EXPENDITURE INCURRED IN RELATION T O SUCH BUSINESS INCOME CANNOT BE CONSIDERED FOR PURPOSES CONSIDERED FOR PURPOSES OF VALUING THE FRINGE BENEFIT, ELSE THERE WOULD BE DOUBLE TAXATION. IN VIEW OF THE ABOVE, IN THE EVENT IT IS HELD THAT THE PROVISION OF AIRCRAFT ON HIRE, IS NOT AN ACTIVITY OF CARRIAGE OF PASSENGER, IT IS RESPECT FULLY SUBMITTED, THAT THE EXPENDITURE INCURRED BY THE APPELLANT DURING SUCH PERIOD CANNOT BE CONSIDERED FOR THE PURPOSES OF VALUATION OF FRINGE BENEFIT. (EMPHASIS OURS) 4. THE LD. CIT(A) REJECTED THE ALTERNATIVE CONT ENTION BY OBSERVING THAT THE ASSESSEE HAD ITSELF ADMITTED LIABILITY OF FBT IN TH E ORIGINAL RETURN FILED BY IT AND THAT EVEN IN THE EARLIER YEARS THE ASSESSEE HAD PAID FBT BASED ON SIMILAR FACTS AND ON THE DOCTRINE OF CONSISTENCY THE CLAIM OF THE ASSESS EE HAS TO BE DISMISSED. HE FURTHER HELD AS FOLLOWS :- THE PROVISIONS FOR LEVY OF FBT WERE INTRODUCED BY THE LEGISLATURE TO DO AWAY WITH THE AD-HOC DISALLOWANCES ON ACCOUNT OF PERSONAL USER OF CERTAIN EXPENSES. UNDER THESE PROVISIONS OF FBT, .THE ACT PROVIDES FOR PRESUMPTIO N THAT PART OF THE EXPENSES ARE USED FOR THE PERSONAL BENEFITS OF EMPLOYEES. THE EX EMPTION IN RESPECT OF EMPLOYER ENGAGED IN THE BUSINESS OF CARRIAGE OF PASSENGERS O R GOODS HAS BEEN PROVIDED BECAUSE THERE IT WAS FELT THAT THE EXPENSES WILL BE MAINLY RELATING TO BUSINESS OF CARRIAGE OF GOODS OR PASSENGERS. IN THE APPELLANTS CASE, THERE IS NO DISPUTE THAT MAJOR AMOUNT. OF THE EXPENSES IS RELATING TO THE OW N USE BY THE COMPANY WHICH IS ALSO EVIDENT FROM THE FACT THAT THE TOTAL EXPENDITU RE ON ACCOUNT OF REPAIR, RUNNING AND MAINTENANCE OF HELICOPTER/AIRCRAFT IS RS.31,80, 00,223/- WHEREAS THE REVENUE (THAT TOO FROM RENTAL HIRE CHARGES) OF AIRCRAFT/HEL ICOPTER IS RS.2,46,26,147/- ONLY. MERELY BECAUSE THE APPELLANT WAS AUTHORIZED BY THE OTHER OBJECTS CLAUSE OF THE MEMORANDUM TO DO THE BUSINESS OF CARRYING ON OF PAS SENGERS/GOODS OR THAT IT WAS PERMITTED BY THE COMPETENT AUTHORITY TO CARRY ON SU CH BUSINESS, IT WILL NOT IMPLY THAT THE APPELLANT HAS ACTUALLY CARRIED ON THE BUSINESS OF CARRYING ON OF PASSENGER/GOODS AND THAT THE EXPENDITURE ON REPAIR, RENEWAL AND DEP RECIATION ETC. HAVE BEEN INCURRED IN RELATION TO THE BUSINESS OF CARRYING ON OF PASSE NGERS/GOODS. THE ORDER OF THE AO FOR CHARGING THE EXPENSES TO FBT IS WELL REASONED AND BASED UPON CORRECT APPRECIATION OF FACTS AND LAW. ITA NOS.1009, 1010/DEL/2011 PUNJ LLOYD LTD. VS ACIT 7 5. AGGRIEVED THE ASSESSEE HAS FILED THIS APPEA L IN ITA 1009/DL/2011 AND ITA NO. 1010/DEL/2011 AGAINST THE COMMON ORDER PASSED BY T HE CIT(A) WHEREIN HE HAD UPHELD THE ORDER OF THE AO PASSED BOTH U/S 154 AND UNDER SECTION 115WE(3) OF THE ACT. 6. WE HAVE HEARD SHRI RUPESH JAIN, LD. COUNSEL FOR THE ASSESSEE AND SHRI VIKRAM SAHAY LD. DR ON BEHALF OF THE REVENUE. 7. SHRI RUPESH JAIN DID NOT PRESSED FOR THE CLAIM OF EXEMPTION U/S 115WC(2)(F) OF THE ACT. THE SUM AND SUBSTANCE OF ITS SUBMISSION IS THAT THE CHARGE OF FRINGE BENEFIT TAX U/S 115WA WOULD COME INTO PLAY ONLY WH EN FRINGE BENEFITS ARE PROVIDED OR DEEMED TO HAVE BEEN PROVIDED BY AN EMPLOYER TO I TS EMPLOYEES DURING THE PREVIOUS YEAR. HE EMPHASISED THE FRINGE BENEFITS ME ANS ANY CONSIDERATION FOR EMPLOYMENT U/S 115WB OF THE ACT AND THAT SUB SECTI ON (2)OF SECTION 115WB IS CONTROLLED BY SECTION 115WB OF THE ACT. FOR THIS PR OPOSITION HE RELIED ON THE DECISION OF MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF DCIT VS. KOTAK MAHINDRA OLD MUTUAL LIFE INSURANCE LTD.134 ITD 388 (M). 8. HE ALSO RELIED ON THE FOLLOWING CASE LAWS : INTERVALVE (INDIA) LTD. VS. ACIT 149 TTJ 365 9. THE LD. DR SHRI VIKRAM SAHAY OPPOSED THE CO NTENTIONS OF THE ASSESSEE AND SUBMITTED THAT SUB SECTION (2) OF SECTION 115WB DEE MS THAT FRINGE BENEFITS HAVE BEEN PROVIDED BY THE EMPLOYER TO ITS EMPLOYEES AND UNDER SUB SECTION (1) THE AMOUNT OF EXPENDITURE INCURRED WAS RIGHTLY BROUGHT TO TAX BY THE AO AND CONFIRMED ITA NOS.1009, 1010/DEL/2011 PUNJ LLOYD LTD. VS ACIT 8 BY THE LD. CIT(A). HE POINTED OUT THAT THE ASSESSEE FILED A REVISED RETURN OF INCOME ONLY ON THE BASIS THAT IT IS ENTITLED TO RELIEF U/ S 115WC (2)(F) OF THE ACT AND WHEN THE SAME IS REJECTED, THE ASSESSEE WITHOUT FURNISH ING ANY DETAILS OR DEMONSTRATING HOW ITS CLAIM IS TENABLE MADE AN ALTERNATIVE CLAIM. HE SUBMITTED THAT THE ASSESSEE NOW CONCEDED THAT IT IS NOT ENGAGED IN THE BUSINESS OF CARRIAGE OF PASSENGERS OR GOODS BY AIR CRAFT AND UNDER THESE CIRCUMSTANCES T HE ORIGINAL RETURN STANDS AND THE STAND OF THE ASSESSEE IN ALL THE PREVIOUS YEARS HAS TO BE CONSIDERED AND THE ORDER OF THE FIRST APPELLATE AUTHORITY UPHELD. 10. RIVAL CONTENTIONS HEARD. ON A CAREFUL CONSIDE RATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND A PERUSAL OF THE PAPE RS ON RECORD AND THE ORDERS OF THE AUTHORITIES BELOW, WE HOLD AS FOLLOWS :- THE CONTENTION OF THE ASSESSEE IS THAT, THE AO HAS GIVEN A FINDING THAT THE EXPENDITURE IN QUESTION WAS INCURRED FOR THE PURPOS E OF BUSINESS, AS THERE IS NO DISALLOWANCE OF ANY EXPENDITURE ON AN ALLEGATION OF PERSONAL USE AND THAT THE EXPENDITURE IN QUESTION IS NOT CONSIDERATION FOR E MPLOYMENT AND HENCE NOT FRINGE BENEFIT TAX AS CONTEMPLATED U/S 115WB (1) OF THE AC T. THIS ARGUMENT HAS TO BE REJECTED FOR THE REASON THAT FRINGE BENEFIT TAX CAN BE LEVIED ONLY WHEN THE EXPENDITURE INCURRED IS FOR THE PURPOSE OF BUSINESS . EVEN SALARY PAID TO AN EMPLOYEE, IS CONSIDERATION FOR EMPLOYMENT AND IS E XPENDITURE INCURRED FOR THE PURPOSE OF BUSINESS. 11. ON THE CONTENTION OF THE ASSESSEE THAT THERE I S NO CONSIDERATION FOR EMPLOYMENT, WE FIND THAT THE ASSESSEE HAD SUBMITTED BEFORE THE CIT(A) THAT THERE ITA NOS.1009, 1010/DEL/2011 PUNJ LLOYD LTD. VS ACIT 9 IS A POSSIBILITY OF THE AIRCRAFT HAVING BEING USED FOR BENEFIT OF THE EMPLOYEES. THE SUBMISSIONS HAVE BEEN EXTRACTED BY US AT PARA 3 OF THIS ORDER. 12. WHEN THE ASSESSEE ADMITS OF A POSSIBILITY OF THE AIR CRAFT HAVING BEEN USED FOR THE USE OF BENEFIT OF EMPLOYEE, TO PLEAD OTHERW ISE AT THIS STAGE CANNOT BE COUNTENANCED. THE ASSESSEE HAS NOT PROVIDED ANY EVI DENCE IN SUPPORT OF THIS CONTENTION. 13. THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF DCIT VS. KOTAK MAHINDRA OLD MUTUAL LIFE INSURANCE LTD., WAS CONSIDERING A CAS E WHERE THERE IS A FINDING OF FACT OF THE CIT(A), THAT THE DAY TO DAY LOCAL TRAVEL EXP ENDITURE AND TAXI HIRE CHARGES WERE FOR MOVEMENT OF EMPLOYEES DURING WORKING HOURS. THE RE IS NO SUCH FACTUAL SUBMISSIONS BY THE ASSESSEE AT ANY STAGE OF PROCEED INGS OR BEFORE US. UNDER THESE CIRCUMSTANCES THIS DECISION IS FACTUALLY INAPPLICAB LE. THE ORDER OF THE PUNE BENCH IN THE CASE OF INTERVALVE (INDIA) LTD. VS ACIT (SUPRA) IS DISTINGUISHABLE AS THE ASSESSEE HAS NOT DEMONSTRATED ON FACTS, ITS CLAIM THAT THE E XPENDITURE IN QUESTION, IS NOT ANY CONSIDERATION FOR EMPLOYMENT. IT IS WELL SETTLED T HAT WHEN A PARTY CLAIMS A PARTICULAR EXEMPTION, IT IS FOR THAT PARTY TO LEAD EVIDENCE AND SUBSTANTIATE ITS CASE. 14. THE ASSESSEE HAS IN THE EARLIER ASSESSMENT YEARS, CONSISTENTLY FILING FBT RETURNS AND PAYING TAX ON THE VERY SAME EXPENDITURE . DURING THE CURRENT YEAR, THE ASSESSEE HAS ORIGINALLY FILED A FBT RETURN AND OFF ERED THE SUM IN QUESTION TO TAX. IT WAS ONLY THEREAFTER A REVISED RETURN IS FILED MAKIN G A CLAIM SPECIFICALLY FOR EXEMPTION U/S 115WC(2)(F). NOW THAT THE ASSESSEE HAS CONCEDED THAT IT IS NOT ELIGIBLE FOR EXEMPTION U/S 115WC(2)(F), THE AMOUNT DECLARED IN THE RETURN OF INCOME BEFORE CLAIMING THIS EXEMPTION WILL BECOME TAXABLE. ITA NOS.1009, 1010/DEL/2011 PUNJ LLOYD LTD. VS ACIT 10 15. IN VIEW OF THE ABOVE DISCUSSION THE APPEAL OF THE ASSESSEE IN ITA NO.1009/DEL/2011 IS DISMISSED. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE APPEAL NO.1010/DEL/2011 WOULD BECOME INFRUCTUOUS IN VIEW OF THE ABOVE SUBMISSIONS. HENCE THIS APPEAL OF THE ASSESSEE IS ALSO DISMISSED. 16. IN THE RESULT BOTH THE APPEALS FILED BY T HE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH JULY, 2015. SD/- SD/- (G.C. GUPTA) (J. SUDHAKAR REDDY) VICE PRESIDENT ACCO UNTANT MEMBER DATED: THE 29 TH JULY, 2015 VEENA COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR 6. GUARD FILE BY ORDER DY. REGISTRAR SL. NO. DESCRIPTION DATE 1. DATE OF DICTATION BY THE AUTHOR 8.7.2015 2. DRAFT PLACED BEFORE THE DICTATING MEMBER 9.7.20 15 3. DRAFT PLACED BEFORE THE SECOND MEMBER 4. DRAFT APPROVED BY THE SECOND MEMBER 5. DATE OF APPROVED ORDER COMES TO THE SR. PS 6. DATE OF PRONOUNCEMENT OF ORDER 7. DATE OF FILE SENT TO THE BENCH CLERK 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK ITA NOS.1009, 1010/DEL/2011 PUNJ LLOYD LTD. VS ACIT 11 9. DATE OF DISPATCH OF ORDER