ACIT, CHENNAI V. M/s. Bharat Overseas Bank Ltd., CHENNAI

ITA 1541/CHNY/2010

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 0851 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 30-01-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 16-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR S MOHARANA
• Keywords: Opportunity of being heard
• Section: 11

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL B BENCH, CHENNAI. BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER & SHRI S.S. GODARA, JUDICIAL MEMBER I.T.A. NO. 1541/MDS/2010 ASSESSMENT YEAR : 2007-08 THE ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY CIRCLE I (2), CHENNAI 600 034. VS. M/S. BHARAT OVERSEAS BANK LTD. (NOW MERGED WITH INDIAN OVERSEAS BANK LTD.), CENTRAL OFFICE, ACCOUNTS DEPT., 763, ANNA SALAI, CHENNAI 600 002. [PAN:AAACB1374M] (APPELLANT) (RESPONDENT) APPELLANT BY : DR. S. MOHARANA, CIT RESPONDENT BY : SHRI C. NARESH, CA DATE OF HEARING : 30.01.2013 DATE OF PRONOUNCEMENT : 20.02.2013 ORDER PER S.S. GODARA, JUDICIAL MEMBER THIS REVENUES APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) III, CHENNAI DATED 28.06.2010 IN FBT NO. 23/09-10/A.III FOR THE ASSESSMENT YEAR 2007 -08 IN PROCEEDINGS UNDER SECTION 115WE(3) OF THE INCOME TAX ACT 1961 [ IN SHORT THE ACT]. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S A BANKING COMPANY, WHICH HAS MERGED WITH INDIAN OVERSEAS BANK. ON 30.1 0.2007, IT HAD FILED ITS RETURN OF FRINGE BENEFIT DECLARING AN AMOUNT OF ` .94,10,345/-. WHILST I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1541/M/10 1541/M/10 1541/M/10 1541/M/10 2 FINALIZING ASSESSEES FRINGE BENEFIT ASSESSMENT UND ER SECTION 115WE(3) OF THE ACT ON 31.12.2009, THE ACIT MADE ADDITION OF ` .2,09,81,000/- QUA PROVISIONS FOR BHARAT OVERSEAS BANK LTD. EMPLOYEES PENSION FUND TRUST AS MADE BY THE ASSESSEE. HE ALSO LEVIED INTEREST UNDER SECTION 115WJ(3) AND 115WK OF THE ACT OF ` .23,52,302/- AND ` .2,46,501/- RESPECTIVELY. 3. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN A PPEAL. THE GIST OF ASSESSEES ARGUMENT IN THE LOWER APPELLATE PROCEEDI NGS WAS THAT THE PROVISION IN QUESTION AS ADDED BY THE ASSESSING OFF ICER DID NOT AMOUNT TO ACTUAL CONTRIBUTION TO AN APPROVED SUPERANNUATION F UND AND THEREFORE, THE CHARGING SECTION I.E. 115WB OF THE ACT DOES NOT A PPLY. WE NOTICE THAT ASSESSEES ARGUMENT STANDS ACCEPTED BY THE CIT(A) A S UNDER: 3.1 I HAVE CONSIDERED THE FACTS OF THE CASE AND THE VARIOUS SUBMISSIONS MADE BY THE LD.AR. I FIND THAT THE PROVISIONS OF TH E ACT ARE CLEAR IN THIS REGARD. AS SUBMITTED BY THE LD AR, AS PER THE PROVI SIONS OF SECTION 115WB (C) ONLY THE CONTRIBUTION TO APPROVED SUPERANNUATION FU ND IS CHARGEABLE TO TAX. THEREFORE, THE LIABILITY IS NOT FASTENED MERELY BEC AUSE A PROVISION IS MADE IN THE ACCOUNTS. THE AMOUNT PROVIDED BECOMES CHARGEABL E TO TAX ONCE THE SAME IS CONTRIBUTED TO THE FUND. I AM THEREFORE OF THE C ONSIDERED OPINION THAT THE MERE PROVISION MADE BY THE APPELLANT WILL NOT RENDE R THE AMOUNT TO BE CHARGEABLE TO TAX. ACCORDINGLY, THIS GROUND OF APPE AL IS ALLOWED. THEREFORE, THE REVENUE IS IN APPEAL. 4. IN THE COURSE OF HEARING, THE DR VEHEMENTLY AR GUED THAT THE CIT(A) HAS WRONGLY INTERFERED IN THE FINDINGS OF ASSESSING OFFICER BY HOLDING THAT THE PROVISION MADE BY THE ASSESSEE IS NOT LIABLE TO BE TAXED. IN SUPPORT OF THE ARGUMENT, HE HAS PLACED RELIANCE ON THE CASE LAW [2 012] 18 TAXMANN.COM I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1541/M/10 1541/M/10 1541/M/10 1541/M/10 3 145 (COCH.) TITLED FEDERAL BANK LTD. VS. ACIT AND P RAYED FOR ACCEPTANCE OF THE APPEAL. 5. IN REPLY, THE ASSESSEE STRONGLY SUPPORTS THE CI T(A) ORDER BY QUOTING THE CASE LAW OF AHMEDABAD BENCH IN ITA NO. 3945/AHD /2008 TITLED AS STATE BANK OF SAURASHTRA VS. ADDL. CIT AND PRAYED FOR UPH OLDING THE FINDINGS UNDER CHALLENGE. 6. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND AL SO PERUSED THE ORDERS PASSED BY THE LOWER AUTHORITIES. THE PRECISE ISSUE THAT ARISES FOR OUR CONSIDERATION IS WHETHER THE PROVISION IN QUESTION PERTAINING TO CONTRIBUTION MADE BY THE ASSESSEE FOR APPROVED SUPERANNUATION FU ND OF ITS EMPLOYEES IS LIABLE TO BE TAXED AS CLAIMED BY THE REVENUE UNDER SECTION 115WB OF THE ACT OR NOT AS SUBMITTED BY THE ASSESSEE. WE FIND THAT THE COORDINATE BENCH OF AHMEDABAD, ITAT (SUPRA) HAS DECIDED THE IS SUE IN FAVOUR OF THE ASSESSEE AS FOLLOWS: 3. THE FACTS OF THE CASE ARE THAT THE AO AFTER SCR UTINIZING THE FRINGE BENEFIT TAX RETURN FILED, ASKED THE ASSESSEE ABOUT THE PAYMENT OF SELF-ASSESSMENT TAX FF RS.4,50,00,000/- AND TO EXPLAIN THE BASIS OF CALCULATION AND PAYMENT OF THE SAME. THE D ETAILS OF CONTRIBUTION TO SUPERANNUATION FUND WERE ALSO ASKED FOR. THE ASSESSEE VIDE ITS LETTERS DATED 26-03-2008 AND 10-0 4-2008 REPLIED TO THE QUERY RAISED BY THE A O. AFTER CONSIDERING T HE REPLY OF THE ASSESSEE, THE AO CONCLUDED AS UNDER IN PARA 2 OF HI S ORDER: 'THE ASSESSEE'S REPLY WAS EXAMINED AND IT WAS FOUND THAT THE ASSESSEE'S CONTENTION IS NOT TENABLE. FRINGE BENEFI T HAS BEEN DEFINED U/S. 115WB AS UNDER: I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1541/M/10 1541/M/10 1541/M/10 1541/M/10 4 FOR THE PURPOSE OF THIS CHAPTER 'FRINGE BENEFITS' MEANS ANY CONSIDERATION FOR EMPLOYMENT PROVIDED BY WAY OF ANY CONTRIBUTION BY THE EMPLOYER TO AN APPROVED SUPERANNUATION FUND FOR THE EMPLOYEES. THE ASSESSEE HAS MADE A PROVISION OF RS.12.61 CRORE S. IT MEANS THAT THE ASSESSEE COMPANY HAS MADE PROVISI ON FOR PAYMENT OF SUPERANNUATION FUND AND ACCORDINGLY AS PER DEFINITION OF FRINGE BENEFIT, THIS HAS ALREADY BEEN PROVIDED AS A WAY OF CONTRIBUTION THOUGH PAID IN THE NEXT YEAR. H ENCE, THIS IS INCLUDIBLE IN THE CALCULATION OF FRINGE BENEFIT AS PER DEFINITION OF FRINGE BENEFITS. THE DEFINITION CLEARLY STATES T HAT THIS IS TO BE PROVIDED ONLY, NOT ACTUAL PAYMENT IS MENTIONED IN THE DEFINITION IN THE ACT. ' 4. THE ASSESSEE CHALLENGED THE ADDITION BEFORE THE LEARNED CIT (A) AND IT WAS SUBMITTED THAT THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS ASKED THE ASSESSEE AS TO WHY PROVISIONS OF `.12,61,00,000 /- MADE IN RESPECT OF SUPERANNUATION FUND BE NOT INCLU DED FOR THE PURPOSE OF LEVY OF FRINGE BENEFIT TAX. IN THIS REGA RD, THE ASSESSEE SUBMITTED THAT THE ASSESSEE VIDE ITS L ETTERS DATED 26-03-2008 AND 10.04.2008 ADDRESSED TO. THE AO EXPLAINED THAT AS P ER THE PROVISIONS OF SECTION 115WC (1 )(B) OF THE IT ACT WHICH PROVID ES COMPUTATION. OF VALUE OF FRINGE BENEFIT, ONLY ACTUAL AMOUNT OF CONT RIBUTION TOWARDS SUPERANNUATION FUND REFERRED TO IN SECTION 115W B (1) ( C ) WHICH DEFINES FRINGE BENEFITS IS LEVIABLE FOR FRINGE BENEFIT TAX. AS PER PROVISIONS OF SECTION 115WB(1)( C) OF THE I.T. ACT, FRINGE BENEFIT TAX MEANS ANY CONTRIBUTION BY THE EMPLOYER TO APPROVED SUPERANNUATION FUND FOR THE EMPLOYEES. DURING THE YEAR UNDER CONSI DERATION I.E. FOR THE YEAR ENDED 31.03.2006 , THE BANK HAS MADE PROVISION FOR SUPERANNUATION FOR EMPLOYEES AMOUNTING RS.12,61,00, 000/-. NO PAYMENT IN RESPECT THEREOF HAS BEEN MADE DURING THE YEAR. THE ACTUAL CONTRIBUTION HAS BEEN MADE DURING YEAR. THEREFORE, IN VIEW O F THE ABOVE CLEAR CUT DEFINITION GIVEN IN THE INCOME TAX ACT ITSELF, SUM ACTUALLY PAID BY THE EMPLOYER (PAID OR DEPOSITED) BY THE EMPLOYER ONLY IT CAN BE TREATED AS CONTRIBUTION. IN THE PRESENT CASE, O NLY THE PROVISION HAS BEEN MADE AND NO PAYMENT HAS BEEN MADE BY THE E MPLOYER OUT OF ITS OWN MONEY TO INDIVIDUAL ACCOUNT OF THE EMPLOYEES AND THEREFORE, THE SAME CANNOT BE TERMED AS CONTRIBUTION. IN VIEW OF T HE ABOVE, ADDITION OF ` .12,61,00,000/- BEING PROVISION MADE FOR SUPERANNUATION FOR EMPLOYEES CANNOT BE ADDED FOR THE PURPOSE OF INCLUS ION OF FRINGE BENEFIT TAX AND THAT AFTER CONSIDERING THE ABOVE, A DDITION OF RS.12,61,00,000/- MADE BY THE AO MAY BE DELETED. I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1541/M/10 1541/M/10 1541/M/10 1541/M/10 5 5. THE LEARNED CIT(A) CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND MATERIAL ON RECORD DISMISSED THE APPEA L OF THE ASSESSEE ON THE ABOVE GROUND. HIS FINDINGS IN PARA 6 OF THE APPELLATE ORDER ARE REPRODUCED AS UNDER: '6. I HAVE CAREFULLY GONE THROUGH THE FACTS OF THE CASE AND THE SUBMISSIONS MADE BY THE LD. A R OF THE APPELLANT AND THE ASSESSMENT ORDER. IN TERMS OF THE PROVISIONS, OF SU B-SECTION (1) OF SECTION 115WA AN EMPLOYER IN INDIA IS LIABLE TO FRINGE BENEFIT TAX (FBT) IN RESPECT OF THE, VALUE OF FRINGE BENEFI T. THE SCOPE OF FRINGE BENEFITS PROVIDED OR DEEMED TO HAVE BEEN PRO VIDED IS DEFINED IN SECTION 115WB. THE FBT IS CALCULATED ON A PRESUMPTIVE BASIS AS A PROPORTION OF THE EXPENSES I NCURRED FOR THE PURPOSES REFERRED TO IN SUB-SECTION (2) OF SECTION 115WB, WHETHER ACTUAL EXPENDITURE ON FRINGE BENEFITS IS MO RE OR LESS THAN THE VALUE OF THE FRINGE BENEFITS, CALCULATED ON THE PRESUMPTIVE BASIS. IN THE CASE OF THE APPELLANT, IT HAS MADE PROVISION FOR CONTRIBUTION THOUGH CLAIMS TO HAVE PAID IN THE NEXT YEAR. FRINGE BENEFITS ARE CHARGED TO TAX W HENEVER PROVIDED TO THE EMPLOYEES FOR A PARTICULAR YEAR. TH E APPELLANT HAS NOT CLARIFIED AS TO WHAT IS THE ACTUAL PAYMENT MADE FOR SUPERANNUATION FUND DURING THE YEAR AND WHAT ACTUALLY HAS BEEN CLAIMED U/S. 43B(B) OF THE ACT. IN THE LETTER DATED 26/3/2008, ADDRESSED TO THE ADDL. CIT, BHAVNAGAR RA NGE-1, BHAVNAGAR, THE DY. GENERAL MANAGER (F&A) OF THE APPELLANT BANK HAS MENTIONED AS UNDER: 'DURING THE YEAR, UNDER CONSIDERATION I.E. FOR THE YEAR ENDED ON 31 ST MARCH, 2006, BANK HAS MADE PROVISION FOR SUPERANNUATION FUND FOR EMPLOYEES AMOUNTING TO RS.12.61 CRORES. WE WERE UNDER THE HONEST BELIEF THAT FRINGE BENEFIT TAX (FBT) IS LEVIABLE IN RESPECT OF PROVISION MADE FOR APPROVED SUPERANNUATION FUND AND ACCORDINGLY, BY WAY OF ABANDONED CAUTION AND TO AVOID LIABILITY OF INTEREST, PAYMENT OF FBT AMOUNTING TO RS.4,50,00,000/- HAS BEEN MADE.' THEREFORE, I HOLD THAT THE AMOUNT IS INCLUDIBLE IN THE CALCULATION OF FBT. IN VIEW OF ABOVE DISCUSSIONS, T HE ADDITION MADE BY THE AO OF RS.12,61,00,000/- IS HEREBY, UPHELD. THE CONTENTION OF THE APPELLANT ON THIS ISSUE IS REJECTED. I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1541/M/10 1541/M/10 1541/M/10 1541/M/10 6 6. LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE AUTHORITIES BELOW AND ALSO REFERRED TO FOURTH SCHEDULE TO IT ACT RELATING TO RECOGNIZED PROVIDENT FUNDS AND REFERRED TO PART B OF THE SCHEDULE REGARDING APPROVED SUPERANNUATION FU NDS IN WHICH DEFINITION OF CONTRIBUTION HAS BEEN ASSIGNED THE SA ME EXPRESSION IN RULE 2 OF PART A IN RELATION TO PROVIDENT FUNDS. IN PART A OF THE SCHEDULE DEFINITION OF CONTRIBUTION IS PROVIDED IN SUB-SECTION 2(C) MEANS ANY SUM CREDITED BY THE EMPLOYER OUT OF HIS O WN MONEY TO THE INDIVIDUAL ACCOUNT OF AN EMPLOYEE. HE HAS THEREFORE, SUBMITTED THAT WHEN ALL THE PROVISIONS ARE READ TOGETHER, IT WOULD BE CLEAR THAT THE LEVY OF FBT WOULD NOT ARISE ON THE MERE PROVISION. HE HAS SUBMITTED THAT UNLESS ACTUAL CONTRIBUTION IS MADE TO AN APPROVED SUPERANNUATION FUND, FRINGE BENEFIT TAX CANNOT BE L EVIED IN THE CASE OF THE ASSESSEE. HE HAS FURTHER SUBMITTED THAT ACTUAL CONTRIBUTION WAS MADE TO THE FUND IN THE NEXT YEAR WHICH WOULD BE TAXABLE IN THE NEXT YEAR ACCORDING TO AMENDED PROVISIONS OF LAW. ON THE OTHER HAND, LEARNED DR RELIED UPON ORDERS OF THE AUTHORITIES BE LOW. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND MATERIAL AVAILABLE ON RECORD. THE RELEVANT PROVISIONS DEALING WITH THE ABOVE CASE ARE REPRODUCED AS UNDER: 7.1 SECTION 115WA (CHARGING OF FRINGE BENEFIT TAX)- (1) IN ADDITION TO THE INCOME-TAX CHARGED UNDER TH IS ACT THERE SHALL BE CHARGED FOR EVERY ASSESSMENT YEAR COMMENCING ON OR AFTER THE 1 ST DAY OF APRIL. 2006, ADDITIONAL INCOME TAX (IN THIS ACT REFERRED TO AS FRINGE BENEF IT TAX) IN RESPECT OF THE FRINGE BENEFITS, PROVIDED OR DEEMED TO HAVE BEEN PROVIDED BY AN EMPLOYER TO HIS EMPLOYEES DURING THE PREVIOUS YEAR AT THE RATE OF THIRTY PER CENT ON THE VALUE OF SUCH FRINGE BENEFITS. (2) NOTWITHSTANDING THAT NO INCOME TAX IS PAYABLE BY AN EMPLOYER ON HIS TOTAL INCOME COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF THIS ACT, THE TAX ON FRINGE BENEFIT S HALL BE PAYABLE BY SUCH EMPLOYER. 7.2 SECTION 115WB (FRINGE BENEFITS) (1) FOR THE PURPOSE OF THIS CHAPTER, FRINGE BENEFITS MEANS ANY CONTRIBUTION FOR EMPLOYMENT PROVIDED BY WAY OF I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1541/M/10 1541/M/10 1541/M/10 1541/M/10 7 (A) (B) .. (C) ANY CONTRIBUTION BY THE EMPLOYER TO AN APPROVED SUPERANNUATION FUND FOR EMPLOYEES. 7.3 SECTION 115WC (VALUE OF FRINGE BENEFITS) (1) FOR THE PURPOSE OF THIS CHAPTER; THE VALUE OF FRING E BENEFITS SHALL BE THE AGGREGATE OF THE FOLLOWING, NAMELY- (A) .......... (B) ACTUAL AMOUNT OF THE CONTRIBUTION REFERRED TO IN CLAUSE (C) OF SUB-SECTION 115WB. 7.4 THE PHILOSOPHY BEHIND THE ENACTMENT OF FBT HAS BEEN EXPLAINED IN THE FINANCE MINISTERS SPEECH IN PARA 160 AS UNDER ( PAGE 56 OF 273 ITR (ST.)): I HAVE LOOKED INTO THE PRESENT SYSTEM OF TAXING PERQU ISITES AND I HAVE FOUND THAT MANY PERQUISITES ARE DISGUISED AS FRINGE BENEFITS AND ESCAPE TAX. NEITHER THE EMPLOYER NOR THE EMPLOYEE PAYS ANY TAX ON THESE BENEFITS, WHICH ARE CERTAINLY OF CONSIDERABLE MATERIAL VALUE. AT PRESENT, WHERE BENE FITS ARE FULLY ATTRIBUTABLE TO THE EMPLOYEE THEY ARE TAXED IN THE HANDS OF THE EMPLOYEE; THAT POSITION WILL CONTINUE. IN ADDITION, I NOW PROPOSE THAT WHERE THE BENEFITS ARE USUALLY ENJOYED COLLECTIVELY BY THE EMPLOYEES AND CANNOT BE ATTRIBUTED TO INDIVIDUAL EMPLOYEES, THEY SHALL BE TAXED IN THE HANDS OF THE EMPLOYER. HOWEVER, TRANSPORT SERVICES FOR WORKERS AND STAFF AND CANTEE N SERVICES IN AN OFFICE OR FACTORY WILL BE OUTSIDE THE TAX NET. 8. WHEN THE ABOVE PROVISIONS ARE READ TOGETHER IN THE LIGHT OF THE FINANCE MINISTERS SPEECH, IT WOULD BE CLEAR THAT A S PER FINANCE ACT 2005, UNDER SECTION 115WC (1) (B) OF THE IT ACT WHAT WOULD BE TAXABLE BY WAY OF FRINGE BENEFIT IS THE ACTUAL AMOUNT OF CO NTRIBUTION REFERRED TO IN CLAUSE (C) OF SUB-SECTION (1) OF SECTION 115WB. SECTION 115WB (1) (C) INCLUDES IN THE FRINGE BENEFITS ANY CONTRIBUTION BY THE EMPLOYER TO AN APPROVED SUPERANNUATION FUND FOR EMPLOYEES. THE WOR D ACTUAL IS NOT USED IN SECTION 115WB (1) (C) BUT IT IS USED IN SEC TION 115WC (1) (B) WHICH DEFINES VALUE OF FRINGE BENEFITS ON WHICH FRI NGE BENEFIT TAXES ARE PAYABLE. UNLESS ALL THE PROVISIONS ARE READ TOGETHER, IT IS DIFFICULT TO LEVY TAX ON FRINGE BENEFITS. UNLESS MACHINERY PROVISIONS ARE APPLIED T O THE RELEVANT PROVISIONS, THE VALUE OF FRINGE BENEFI TS CANNOT BE CALCULATED AND NO TAX COULD BE LEVIED AS PER LAW. W HEN ALL THE I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1541/M/10 1541/M/10 1541/M/10 1541/M/10 8 PROVISIONS WOULD BE READ TOGETHER, IT WOULD LEAD TO IRRESISTIBLE CONCLUSION THAT FRINGE BENEFIT TAX CAN BE LEVIED WHEN THERE IS ACTUAL CONTRIBUTION BY THE EMPLOYER TO AN APPROVED SUPERANNUATION FUND FOR THE EMPLOYEES. IT WOULD BE THEREFORE, CLEAR AND RELEVANT THAT THE VALUATION OF FRINGE BENEFITS BEING CONTRIBUTION TO SUPERANNUATION FUND BECOMES RELEVANT AND MATERIAL ONLY WHEN ACTUAL AMOU NT IS CONTRIBUTED BY THE EMPLOYER TO AN APPROVED SUPERANNUATION FUND FOR THE EMPLOYEES. THE FRINGE BENEFIT COULD ONLY BE SUCH BENEFIT WHICH IS ACTUALLY AND USUALLY ENJOYED BY THE EMPLOYEES. THE SAME LANGUAGE IS USED IN THE SPEECH OF THE FINANCE MINISTER ALSO. THE ASSESSEE P LEADED THAT BANK HAS NOT MADE ANY ACTUAL PAYMENT BUT HAS MADE PROVISIONS OF RS.12.16 CRORES FOR SUPERANNUATION FUND BUT NO DETAILS HAVE BEEN ME NTIONED EITHER IN THE ASSESSMENT ORDER OR IN THE ORDER OF T HE LEARNED CIT(A). 9. LEARNED COUNSEL FOR THE ASSESSEE REFERRED TO DEF INITION OF CONTRIBUTION AS PER FOURTH SCHEDULE PART A (SUPRA), SUB-SECTION (2) (C) OF THE ABOVE SCHEDULE PROVIDES - 'CONTRIBUTION' MEA NS ANY SUM CREDITED BY OR ON BEHALF OF ANY EMPLOYEE OUT OF HIS SALARY O R BY AN EMPLOYER OUT OF HIS OWN MONIES, TO THE INDIVIDUAL ACCOUNT OF AN EMPLOYEE BUT DOES NOT INCLUDE ANY SUM CREDITED AS INTEREST.' THE ABOV E DEFINITION OF THE CONTRIBUTION WOULD NOT SUPPORT THE CASE OF THE ASSE SSEE BECAUSE THE DEFINITION OF THE FRINGE BENEFIT AS PROVIDED U/S 11 5WB (1) (C) PROVIDES ANY CONSIDERATION FOR EMPLOYMENT PROVIDED BY WAY OF ANY CONTRIBUTION BY THE EMPLOYER TO AN APPROVED SUPERANNUATION FUND FOR EMPLOYEES. WHAT IS REQUIRED BY THE ABOVE PROVISION FOR TAXING THE FRINGE BENEFIT THAT THERE SHOULD BE CONTRIBUTION BY THE EMPLOYER T O AN APPROVED SUPERANNUATION FUND FOR EMPLOYEES. BUT THE DEFINITI ON OF CONTRIBUTION REFERRED TO BY THE LEARNED COUNSEL FOR THE ASSESSEE PROVIDES CONTRIBUTION BY AN EMPLOYE3R OUT OF HIS OWN MONEY T O THE INDIVIDUAL ACCOUNT OF AN EMPLOYEE. THERE IS A CONTRADICTION IN BOTH THE LANGUAGE. MOREOVER, SUB-SECTION (2) OF PART A OF FOURTH SCHEDULE TO THE INCOME TAX ACT PROVIDES THAT IN THIS PART, UNLESS THE CONT EXT OTHERWISE REQUIRES .. SINCE, THE DEFINITION OF FRINGE BENEFIT IS OUT OF CONTEXT AS PER FOURTH SCHEDULE, THE CONTENTION OF LEARNED COUNSEL FOR THE ASSESSEE IS REJECTED. 10. CONSIDERING THE ABOVE DISCUSSIONS, IT IS CLEAR THAT FRINGE BENEFIT COULD BE TAXED WHEN THE ACTUAL CONTRIBUTION IS CONTRIBUTED BY THE EMPLOYER TO AN APPROVED SUPERANNUATION FUND FOR EMPLOYEES. THEREFORE, NO FRINGE BENEFIT TAX IS LEVIABLE WHEN THERE IS NO ACTUAL CONTRIBUTION IS MADE BY THE ASSESSEE BANK TO THE APPROVED SUPERANNU ATION FUND. SINCE THE AUTHORITIES BELOW HAVE NOT DISCUSSED THE ACTUAL FACTS IN THE IMPUGNED ORDERS AND NOTHING IS BROUGHT ON RECORD WH ETHER ASSESSEE I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1541/M/10 1541/M/10 1541/M/10 1541/M/10 9 ACTUALLY CONTRIBUTED THE AMOUNT TOWARDS APPROVED SUPERANNUATION FUND; THEREFORE, THE MATTER REQUITE RECONSIDERATION AT TH E LEVEL OF THE AO. 11. WE ACCORDINGLY, SET ASIDE THE ORDERS OF THE AUT HORITIES BELOW AND RESTORE THE MATTER TO THE FILE OF THE AO WITH DIREC TION TO RE-DECIDE THE ISSUE IN THE LIGHT OF THE FINDINGS GIVEN IN THIS OR DER BY GIVING REASONABLE SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. 12. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS A LLOWED FOR STATISTICAL PURPOSE ON THE ABOVE ISSUE. TAKING CUE FROM THE SAME, WE ALSO HOLD THAT MERELY BY MAKING A PROVISION, THE ASSESSEE HAS NOT MADE ANY ACTUAL CON TRIBUTION TO THE APPROVED PENSION FUND IN QUESTION SO AS TO ATTRACT THE CHARGING SECTION AFORESAID. SO FAR AS THE CASE LAW CITED BY THE REVE NUE IS CONCERNED (SUPRA), MINDFUL OF THE TRITE PREPOSITION OF THE LAW IS THAT IN CASE OF TWO DIVERGENT JUDICIAL OPINIONS, THE ONE WHICH FAVOURS THE ASSESS EE HAS TO BE ADOPTED, WE HEREBY DECIDE THE APPEAL IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. IN THIS REGARD, WE FIND SUPPORT FROM THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. VEGETABLE PROD UCTS LTD. [88 ITR 192]. I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1541/M/10 1541/M/10 1541/M/10 1541/M/10 10 7. THEREFORE, THE REVENUES APPEAL IS DISMISSED AN D ORDER PASSED BY THE CIT(A) IS UPHELD. ORDER PRONOUNCED ON WEDNESDAY, THE 20 TH OF FEBRUARY, 2013 AT CHENNAI. SD/ - SD/ - (N.S. SAINI) ACCOUNTANT MEMBER (S.S. GODARA) JUDICIAL MEMBER CHENNAI, DATED, THE 20.02.2013 VM/- TO: THE ASSESSEE//A.O./CIT(A)/CIT/D.R.