The ITO,TDS-2, Baroda V. Oil & Natural Gas Corporation Ltd., Bharuch

ITA 304/AHD/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 72977 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-02-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 05-02-2014
• Assessment Year: 2010-2011
• Appeal Filed On: 02-02-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K C MATHEWS
• Keywords: Depreciation; Salary income; Cost of acquisition
• Section: 10(14); 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH BEFORE: SRI D.K TYAGI, JUDICIAL MEMBER AND SHRI ANIL CHATURVEDI, ACCOUNTAN T MEMBER 1.ONGC, BASIN BARODA 2.ONGC, CWS, BARODA 3.ONGC, CAMBAY 4.ONGC, ANKLESHWAR (APPELLANT) VS ASSISTANT COMMISSIONER OF INCOME-TAX (TDS), BARODA (RESPONDENT) ITO(TDS), BARODA (APPELLANT) VS 1.ONGC, BASIN BARODA 2.ONGC, CWS, BARODA 3.ONGC, CAMBAY 4.ONGC, ANKLESHWAR (RESPONDENT) REVENUE BY: SRI K.C.MATHEWS, SR.D.R. ASSESSEE BY: SRI S.N. SOPARKAR, A.R. DATE OF HEARING : 06-02-2014 DATE OF PRONOUNCEMENT : 14-02-20 14 / ORDER PER BENCH:- ITA NOS.155,159, 287 & 332/AHD/2012 ASSESSMENT YEAR 2010-11 ITA NOS. 304,308, 270 & 300/AHD/2012 ASSESSMENT YEAR 2010-11 ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 2 THESE CROSS APPEALS FILED AGAINST THE ORDERS OF LD. CIT(A) DATED 14- 11-2011, 15-11-2011,16-11-2011 & 17-11-2011 FOR A.Y . 2010-11 BELONGING TO DIFFERENT UNITS OF ONGC, WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY THIS CONSOLIDATED ORDER. FIRST WE WILL TAKE UP ASSESSEES APPEAL IN ITA NO. 155, 159, 287 & 332/AHD/2012 2. THE ASSESSEE HAS TAKEN FOLLOWING COMMON GROUNDS IN THESE APPEALS:- 1. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS )-I, BARODA (HEREINAFTER 'CIT (APPEALS)') HAS ERRED IN LAW AND IN FACTS AND CIRCUMSTANCES OF THE CASE IN UPHOLDING THE ORDER PA SSED BY ACIT (TDS), BARODA WHEREBY THE APPELLANT WAS HELD TO BE AN ASSESSEE IN DEFAULT FOR NOT DEDUCTING TAX AT SOURCE FROM, INTER -ALIA, REIMBURSEMENT OF COST OF UNIFORM, STITCHING CHARGES, WASHING EXPE NSES, ETC. (HEREINAFTER 'UNIFORM REIMBURSEMENTS ), MADE TO ITS EMPLOYEES AND WAS CALLED UPON TO PAY THE TAX ALLEGEDLY SHORT DEDU CED FROM ITS EMPLOYEES U/S 201(1) AND INTEREST THEREON U/S. 201( 1A) OF THE INCOME- TAX ACT, 1961 (HEREINAFTER 'ACT'). 2. THE LEARNED CIT (APPEALS) HAS ERRED IN LAW AND I N FACTS AND CIRCUMSTANCES OF THE CASE IN NOT DELETING THE DEMAN D U/S. 201(1) OF THE ACT FOR THE TAX ALLEGEDLY SHORT DEDUCTED FROM EMPLO YEES WHICH WAS RAISED BY THE ACIT (TDS), BARODA. IN RESPECT OF UNI FORM REIMBURSEMENTS. 3. THE LEARNED CIT (APPEALS) HAS ERRED IN LAW AND I N FACTS AND CIRCUMSTANCES OF THE CASE IN NOT DELETING THE DEMAN D FOR INTEREST U/S, 201(1A) WHICH WAS RAISED BY THE ACIT (TDS), BARODA, IN RESPECT OF UNIFORM REIMBURSEMENTS. 4. WITHOUT PREJUDICE, THE LEARNED CIT (APPEALS) HAS ERRED IN LAW AND IN FACTS AND CIRCUMSTANCES OF THE CASE IN UPHOL DING THE ACIT (TDS), BARODA'S ACTION IN RAISING DEMAND FOR TAX ON UNIFORM REIMBURSEMENTS AND INTEREST THEREON IGNORING THE FA CT THAT THE DEMAND SO RAISED BY THE ACIT (TDS), BARODA ; INCLUDED DEMAND IN ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 3 RESPECT OF THOSE EMPLOYEES FROM WHOM TAX HAD ALREAD Y BEEN DEDUCTED BY THE APPELLANT ITSELF. 3. THE FACTS IN RESPECT OF THIS GROUND HAVE BEEN SU MMARIZED BY LD. CIT(A) AS UNDER:- APPELLANT WAS PAYING UNIFORM ALLOWANCE TO ITS EMPL OYEES FOR LAST SEVERAL YEARS IN QUARTERLY/HALF YEARLY I NSTALLMENTS. DURING SURVEY U/S.133A CONDUCTED IN APPELLANT'S OFFICES AT BARODA AND ANKLESHWAR, IT WAS FOUND THAT NONE OF THE EMPLOYEES WORE ANY UNIFORM. EVEN IN POST SURVEY PROCEEDINGS CONDUCTED BY ACIT(TDS) U/S.201(1), NONE OF THE EMPLOYEES WHO APPEAR ED WORE ANY UNIFORM. ACIT(TDS) FURTHER PERTAINED FROM SHR I R. P. BHATT, SR. FINANCE & ACCOUNTS OFFICER, ONGC, KHAMBHAT, WHO APP EARED BEFORE HIM ON BEHALF OF THE APPELLANT THAT UNIFORM WAS PRE SCRIBED IN ONGC TILL 16,11.1995 ONLY, AFTER WHICH IT WAS DECIDED BY THE MANAGEMENT, ASSOCIATION OF EMPLOYEES, UNION ETC. TO DISCONTINUE THE UNIFORM. HOWEVER, FOR THE BENEFIT OF EMPLOYEES, AMOUNT OF AL LOWANCE WAS STARTED IN THE NAME OF UNIFORM ALLOWANCE COMPRISING 70 % IN THE NAME OF UNIFORM, 20% IN THE NAME OF CANTEEN SUBSIDY AND 10% IN THE NAME OF WASHING ALLOWANCE. THE AMOUNT O F UNIFORM ALLOWANCE PAID WAS SUBSEQUENTLY RECOVERED BACK AS C ONTRIBUTION TO PRBS 'POST RETIREMENT BENEFIT SCHEME). ACIT(TDS) RE FERRED TO THE DICTIONARY MEANING OF THE WORD 'UNIFORM' TO CONCLUD E THAT NORMAL CLOTHING WORN BY 'EMPLOYEES COULD NOT BE CALLED UNI FORM. APPELLANT'S SUBMISSION BEFORE THE ACIT(TDS) WAS THAT IT HAD PAI D FBT ON THIS ALLOWANCE TILL F.Y. 2008-09 AND FROM F.Y.2009-1 0, I.E. UPON ABOLITION OF FBT, TREATED UNIFORM ALLOWANCE AS PART OF TAXABLE SALARY INCOME. AS PER APPELLANT, TDS FROM EMPLOYEES ' SALARY WAS THEREFORE NOT APPLICABLE TILL F.Y. 2008 -09. APPELLANT SUBMITTED THAT THOUGH CONSEQUENT UPON ABOLITION OF FBT, UNIFORM ALLOWANCE WAS TREATED AS PART OF TAXABLE SALARY, SINCE IT WAS REIMBURSEMENT OF EXPENSES ONLY, EMPLOYEE MAY CLAIM EXEMPTION FROM TA X BY FURNISHING DECLARATION IN HIS RETURN OF INCOME. AC IT(TDS) OBSERVED THAT EMPLOYER WAS AWARE THAT THERE WAS NO UNIFORM IN FOR CE AND IT WAS A DISGUISED PAYMENT OF SALARY ONLY. ACIT(TDS) NOTED T HAT IN A,Y.2009- 10, CIT(A)-VI, BARODA HAD DECIDED THIS I SSUE AGAINST THE APPELLANT. ACIT(TDS) REFERRED TO CIRCULAR NO.8/2005 BY THE CBDT, I.E. EXPLANATORY NOTES ON PROVISIONS RELATING TO FR INGE BENEFIT TAX TO ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 4 CONCLUDE THAT UNIFORM ALLOWANCE DID NOT FALL WITHIN THE PURVIEW OF FRINGE BENEFIT TAX. IN THIS REGARD, ACIT(TDS) NOTED THAT UNIFORM ALLOWANCE, CMRE, GOLD COIN, HOLIDAY HOME REIMBUR SEMENT AND FURNITURE PURCHASE ADVANCES WERE GIVEN TO INDIVI DUAL EMPLOYEES AND NOT COLLECTIVELY, PAYMENTS WERE CASH AND THER E WAS NO DIFFICULTY IN VALUING THE BENEFITS BEING IN M ONEY. ACIT(TDS) CONCLUDED THAT PAYMENT OF FBT DID NOT EXTINGUISH E MPLOYER APPELLANT'S LIABILITY TO DEDUCT TAX AT SOURCE FROM SUCH PAYMENTS WHICH WERE NOTHING BUT 'SALARY'. ACIT(TDS) HELD THAT UNIF ORM ALLOWANCE WAS PAID ONLY WITH THE PURPOSE OF ADD ITIONALLY REMUNERATING THE EMPLOYEES AND WAS THUS THEIR ADDITIONAL SALARY INCOME. ACIT(TDS) HELD APPELLANT TO BE ASSESSEE IN DEFAULT FOR NOT DEDUCTING TAX AT SOURCE FROM UNIFORM ALLOWANCE PAYMENTS TO EM PLOYEES DUE TO THE SAME CONSTITUTING THEIR SALARY INCOME. 4. BEFORE LD. CIT(A) ASSESSEE MADE FOLLOWING SUBMIS SION AS SUMMARIZED BY LD. CIT(A):- UNIFORM ALLOWANCE WAS GRANTED TO EMPLOYEES IN MONE TARY TERMS ON QUARTERLY BASIS IN ADVANCE. THEREAFTER, EMPLOYEES WERE REQUIRED TO SUBMIT CERTIFICATE OF ACTUAL EXPENSES INCURRED IN P RESCRIBED FORM AT THE END OF THE YEAR. UNIFORM ALLOWANCE WAS TAXABLE IN THE HANDS OF EMPLOYEES. HOWEVER, THE SAME WAS EXEMPT IN VIEW OF SECTION 10(14)(I) READ WITH RULE 2BB UP TO ACTUAL EXPENDITURE. APPELL ANT COULD NOT BE TREATED AS ASSESSEE IN DEFAULT EVEN IF IT WAS ULTIM ATELY HELD THAT AMOUNT REIMBURSED TO EMPLOYEES OR ANY PART THEREOF WAS TAXABLE IN THEIR HANDS SINCE APPELLANT COULD NOT BE EXPECTED T O GO BEYOND DECLARATIONS SUBMITTED BY THE EMPLOYEES. IN THIS RE GARD, REFERENCE WAS MADE TO DECISION IN THE CASE OF CIT VS. LARSEN & TUBRO LTD (2009) 221 CTR 620 (SC) TO CONTEND THAT ASSESSEE EM PLOYER WAS NOT RESPONSIBLE TO MAINTAIN ANY KIND OF DETAILS OR EVIDENCE OF ACTUAL AMOUNT UTILIZED BY THE EMPLOYEE. 'U NIFORM' MEANS A STANDARD STYLE OF DRESS WORN BY STAFF MEMBERS OF AN OFFICE, HOTEL, HOME ETC. AND IT SHOULD NOT BE INTERPRETED IN TERMS OF UNIFORMITY OF DRESSING STYLE. APPELLANT'S EMPLOYEES DO WEAR SUCH UNIFORMS SO AS TO MAINTAIN OFFICE DECORUM. REGARDING ACIT(TDS)'S OBSE RVATION ABOUT NON WEARING OF UNIFORM BY EMPLOYEES, AS NOTED DURIN G SURVEY AND POST SURVEY PROCEEDINGS, WEARING OF UNIFORM BY EMPL OYEES WAS A DISCIPLINARY MATTER BETWEEN APPELLANT AND ITS EMPLO YEES AND NO ADVERSE INFERENCE AS TO BONAFIDES OF APPELLANT COUL D BE DRAWN FROM ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 5 THIS FACT ALONE. REGARDING EXPLANATION GIVEN BY SHR I R.P. BHATT, BEING FROM ACCOUNTS AND FINANCE DEPARTMENT, HE WAS NOT AW ARE OF HUMAN RESOURCE POLICIES OF APPELLANT COMPANY. FURTHER, M ERELY BECAUSE SAME AMOUNT EQUIVALENT TO UNIFORM ALLOWANCE WAS INV ESTED IN PRBS COULD NOT LEAD TO ADVERSE INFERENCE. FURTHER, APPEL LANT HAD PAID FBT ON UNIFORM ALLOWANCE FOR A.YRS. 2006-07 TO 2008-09 AND THE SAME AMOUNT COULD NOT BE THEREFORE TAXED IN APPELLANT'S HANDS AS PER SUPREME COURT'S DECISION IN R & B FALCON (A) PTY LT D. IN APPEAL (CIVIL) 3326 OF 2008. UNIFORM ALLOWANCE WAS LIABLE FOR FBT AS PER FAQ NO.74 OF CBDTS CIRCULAR NO.8/2005 DATED 29.8.20 05. ACIT(TDS)'S OBSERVATIONS THAT UNIFORM ALLOWANCE COU LD NOT BE TREATED AS A FRINGE BENEFIT BEING PAID TO INDIVIDUA L EMPLOYEE IN CASH, ABSENCE OF COLLECTIVE ENJOYMENT ETC, WERE COUNTERED . LASTLY, REFERENCE WAS MADE TO CIT(A)-XXI, AHMEDABAD'S DECISION IN TH E CASE OF ONGC, AHMEDABAD FOR A.Y. 208-09 AND A.Y. 2009-10 DE CIDING THE ISSUE IN FAVOUR OF APPELLANT. 5. AFTER TAKING INTO CONSIDERATION THESE SUBMISSION S OF THE ASSESSEE LD. CIT(A) CONFIRMED THE ACTION OF AO BY OBSERVING AS U NDER:- APPELLANT'S CONTENTION THAT THE NORMAL DRESS WORN BY ITS EMPLOYEES IN OFFICE IS 'UNIFORM' CANNOT BE ACCEPTED. AS PER RANDOM HOUSE DICTIONARY MEANING CITED BY THE APPELLANT, DI CTIONARY MEANING CITED BY THE ACIT(TDS) OR OTHERWISE UNDERSTOOD IN C OMMON PARLANCE, 'UNIFORM' IS AN IDENTIFYING OUTFIT OR STYLE OF DRES S WHICH IS IDENTICAL OR CONSISTENT WITHOUT VARIATIONS IN DETAILS. EXAMPLES ARE UNIFORM OF POLICE PERSONNEL, ARMED FORCES, CANTEEN STAFF ETC. UNIFORM MAY CHANGE AS PER RANK AND DESIGNATION OF GROUP OF EMPLOYEES CONCERNED. IF APPELLANT'S INTERPRETATION OF ' UNIFORM' WERE TO BE ACCEPTED, IN EVERY OFFICE, ANY DRESS WORN BY THE EM PLOYEES' WOULD QUALIFY AS 'UNIFORM'. APPELLANT HAS NOT COMMENTED O N THE FACT THAT PRESCRIBED UNIFORM WAS DONE AWAY IN ONGC WAY BACK I N 1995. THERE IS NO DOUBT THAT THERE WAS NO 'UNIFORM' PRESCRIBED IN ONGC DURING THE PERIOD UNDER CONSIDERATION AND THIS FACT WAS WE LL WITHIN THE KNOWLEDGE OF APPELLANT. CONCLUSION DRAWN BY THE ACI T(TDS) THAT ADDITIONAL SALARY IN THE GARB OF 'UNIFORM ALLOWANCE ' WAS BEING PAID IS THEREFORE, ON SOUND FOOTING. SINCE THE PAYMENT IN Q UESTION WAS NOT TOWARDS PURCHASE OR MAINTENANCE OF 'UNIFORM', IT CA NNOT BE COVERED UNDER RULE 2BB(L)(F)READ WITH SECTION10(14)(I). APP ELLANT'S CONTENTION THAT TAX AT SOURCE WAS NOT DEDUCTED FROM PAYMENTS I N THE NATURE OF ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 6 UNIFORM ALLOWANCE, DUE TO THE SAME BEIN G EXEMPT U/S.10(14)(I) READ WITH RULE 2BB BASED ON DECLARATIONS FURNISHED BY EMPLOYEES IS NOT TENABLE SINCE APPELLANT WAS WELL AWARE THAT THE RE WAS NO 'UNIFORM' PRESCRIBED AND QUESTION OF ANY ALLOWANCE TO MAINTAIN THE SAME DID NOT ARISE. SINCE THE ALLOWANCE PAID WAS N OT TOWARDS THE MAINTENANCE OF UNIFORM BY EMPLOYEES, THERE BEING NO UNIFORM PRESCRIBED IN ONGC, THE WHOLE DEBATE REGAR DING 'UNIFORM ALLOWANCE' BEING LIABLE TO FBT OR NOT IS IRRELEVANT . AS HELD ABOVE, THE PAYMENT IN QUESTION WAS ADDITIONAL SALARY TO EMPLO YEES IN THE GARB OF 'UNIFORM ALLOWANCE'. SUCH DIRECT PAYMENT OF ADDI TIONAL SALARY IS NOT LIABLE TO FBT UNDER ANY OF THE CLAUSES OF SECTI ON 115WB EITHER AS FRINGE BENEFITS LISTED IN SUB SECTION (1) OR DEEMED FRINGE BENEFITS LISTED IN SUBSECTION (2). IT IS HELD THAT ACIT(TDS) WAS JU STIFIED IN HOLDING APPELLANT TO BE ASSESSEE IN DEFAULT U/S.201(1) FOR NOT DEDUCTING TAX AT SOURCE FROM UNIFORM ALLOWANCE PAID F OR ALL THE YEARS UNDER APPEAL. 6. AT THE TIME OF HEARING OF THESE APPEALS LEARNED COUNSEL OF THE ASSESSEE WAS SPECIFICALLY ASKED WHETHER DURING THE YEAR UNDE R APPEAL ANY UNIFORM FOR THE EMPLOYEES WAS PRESCRIBED BY THE COMPANY AN D THE ANSWER WAS IN NEGATIVE. IN VIEW OF THIS UNDISPUTED FACT OF THIS CASE ANY ALLOWANCE GIVEN BY THE COMPANY TO ITS EMPLOYEES IN THE NAME OF UNIFORM ALLOWANCE CANNOT BE SAID TO BE EXEMPT UNDER RULE 2BB(1)(F) R.W.S 10(14) (I) OF THE INCOME TAX ACT AND THE CONTENTION OF THE ASSESSEE COMPANY HAS RIGHTLY BEEN REJECTED BY LD. CIT(A) THAT TAX AT SOURCE WAS NOT DEDUCTABLE FR OM PAYMENTS IN THE NATURE OF UNIFORM ALLOWANCE DUE TO SAME BEING EXEMP T U/S. 10(14)(I) R.W.S. 2BB AND THE ORDER PASSED BY HIM ON THIS ISSUE IS HE REBY UPHELD. THIS GROUND OF THE ASSESSEE IN ALL THE APPEALS IS DISMIS SED. IN THE RESULT, APPEALS FILED BY THE ASSESSEE ARE DISMISSED. REVENUES APPEALS IN ITA NOS. 304,308, 270 & 300/AH D/2012 ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 7 7. REVENUE HAS FILED CROSS APPEALS BY TAKING FOLLOW ING COMMON GROUND EXCEPT THE FIGURE:- 1. THE LD. CIT(A) ERRED IN LAW AS WELL AS FACTS OF THE CASE IN DELETING THE ORDER PASSED U/S. 201(1) & INTEREST CH ARGED U/S. 201(1A) OF THE IT ACT. OF RS. 2,25,00,163/- AND RS. 14,62, 511/- RESPECTIVELY, FOR A.Y. 2010-11 BY THE AO EVEN THROUGH DURING THE COURSE OF VERIFICATION IT WAS NOTICED THAT THE ASSESSEE COMPA NY WAS PAID CONVEYANCE, MAINTENANCE, REIMBURSEMENT EXPENDITURE (CMRE) TO ITS EMPLOYEES EVERY MONTH BASED ON THEIR STATUS, DESIGN ATION. DESPITE THE FACT THE PAYMENT OF CMRE WAS TAXABLE AS SALARY AND EMPLOYER HAD NOT DEDUCTED TDS ON THE SAME. 2. THE LD. CIT(A) ERRED IN LAW AS WELL AS FACTS OF THE CASE IN DELETING THE ORDER PASSED U/S. 201(1) & INTEREST CH ARGED U/S. 201(1A) OF THE IT ACT OF RS. 3,77,75,528/- AND RS. 11,33,26 6/- RESPECTIVELY, FOR A.Y. 2010-11 BY THE ASSESSING OFFICER EVEN THROUGH DURING THE COURSE OF VERIFICATION IT WAS NOTICED THAT EMPLOYEES WERE RECEIVED INTEREST FREE ADVANCES TO PURCHASE HOUSE HOLD GOODS AND FURN ITURE AND AMOUNT OF RS. 1 LAKH TO RS. 4 LAKHS AS PER THEIR CHOICES A ND BILLS WERE RAISED IN THE NAME OF EMPLOYER I.E. ONGC. THEREFORE, SUCH AMOUNT PAID IS TAXABLE INCOME IN ADDITION TO THE SALARY TAXABLE U/ S. 17(1) (IV) OF THE INCOME-TAX ACT. 8. FACTS RELATING TO GROUND NO. 1 HAVE BEEN SUMMARI ZED BY LD. CIT(A) AS UNDER:- ACIT(TDS) REFERRED TO THE CMRE SCHEME AS PER ONGC ORDER DATED 24.10.2008 UNDER WHICH EMPLOYEES WERE PAID CMRE FOR USE OF THEIR PRIVATE VEHICLES IN OFFICIAL WORK. ACIT(TDS) OBSERV ED THAT DESPITE PAYMENT OF CMRE TO EMPLOYEES FOR OFFICIAL WORK, THE RE WAS HEAVY EXPENDITURE BY APPELLANT IN HIRING TAXIS AND BUSES. ACIT(TDS) REFERRED TO 254 ITR 121, I.E. DECISION IN APPELLANT 'S CASE FOR A.Y.1995- 96, WHEREIN CMRE WAS CLAIMED TO BE AN ALLOWANCE COV ERED U/S. 10(14) AND NOT REIMBURSEMENT DUE TO WHICH IT COULD NOT BE, AS PER ACIT(TDS), COVERED UNDER PROVISIONS OF FBT. APPELLA NT'S CONTENTION IN THIS REGARD WAS THAT CMRE WAS A FRINGE BENEFIT U PTILL F.Y.2008-09 DUE TO WHICH TDS WAS NOT APPLICABLE AND FROM F.Y.20 09-10, TDS WAS BEING MADE AS PER RULE 3 OF INCOME TAX RULES. ACIT( TDS) HELD THAT TREATMENT OF CMRE BY THE APPELLANT OVER VARIOUS YEA RS WAS SELF ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 8 CONTRADICTORY, WHICH PROVED THAT THERE WAS NO ACTUA L REIMBURSEMENT AND MONEY WAS PAID ONLY TO REMUNERATE THE EMPLOYEES . ACIT(TDS) DID NOT FIND CMRE TO BE MEETING BASIC CRITERIA FOR FRINGE BENEFIT, I.E. A COLLECTIVE BENEFIT, DIFFICULTY IN VALUATION ETC. ACIT(TDS) REFERRED TO THE FACTS ASCERTAINED FROM SHRI R. R. BHATT, SR. FI NANCE & ACCOUNTS OFFICER, KHAMBHAT, WHO APPEARED BEFORE HIM THAT THE EMPLOYEES WORKING IN ONGC OFFICE AT KHAMBHAT DID NOT HAVE TO VISIT ANY OTHER OFFICE OR PLACE FOR OFFICE WORK, ARRANGEMENT WAS MA DE TO PICK UP AND DROP THOSE EMPLOYEES WORKING AT DRILLING AND PRODUC TION FACILITIES FROM A COMMON POINT AND CMRE WAS PAID FOR THOSE EMP LOYEES WHO DID NOT HAVE PICK UP AND DROP FACILITY AND REACHED OFFICE USING THEIR OWN CONVEYANCE. ACIT(TDS) FURTHER OBSERVED THAT CMR E WAS PAID EVEN TO SUCH EMPLOYEES WHO COULD NOT HAVE USED THEI R PERSONAL VEHICLE FOR OFFICIAL DUTIES, ACIT(TDS) HELD THAT IN COME TAX ACT AND RULES SPECIFICALLY PROVIDED THAT SUCH ALLOWANCE COU LD BE CLAIMED AS EXEMPT ONLY WHEN ACTUALLY INCURRED WHOLLY AND EXCLU SIVELY FOR OFFICIAL DUTIES AND EMPLOYER HAD RESPONSIBILITY TO MAINTAIN RECORD FOR THE JOURNEYS UNDERTAKEN AND EVIDENCE TO PROVE THAT EXPE NDITURE WAS ACTUALLY INCURRED IN OFFICIAL DUTIES. AS PER ACIT(T DS), APPELLANT COULD NOT PRODUCE ANY SUCH RECORD MAINTAINED AS PRE SCRIBED IN INCOME TAX ACT, RULES AND CIRCULARS, NEITHER ANY DE CLARATIONS FROM EMPLOYEES WERE EVER PRODUCED AND EMPLOYEE HAD ONLY TO FURNISH A CERTIFICATE TO CLAIM THE ALLOWANCE. ACIT(TDS) CONCL UDED THAT PAYMENT MADE TO EMPLOYEES UNDER CMRE SCHEME HAD NO NEXUS WITH ACTUAL INCURRING OF EXPENDITURE AND IT WAS ONLY A M ONTHLY PAYMENT IN ADDITION TO SALARY. ACIT(TDS) ALSO OBSERVED THAT CM RE WAS PAID BASED ON DESIGNATION OF OFFICIAL ON FIXED MONTHLY R ATE AND WAS THEREFORE, AN ALLOWANCE JUST LIKE TRANSPORT ALLOWAN CE, WHICH WAS PART OF THE SAME PAYMENT. AS PER ACIT(TDS), SINCE THE PA YMENT OF CMRE WAS MADE EVEN WHEN EMPLOYEE WAS PROVIDED A STAFF CA R AND EVEN WHEN HE DID NOT KEEP HIS CAR AT THE STATION OF POST ING AND ALSO WHEN HE WAS ON LEAVE SHOWED THAT IT WAS NOTHING BUT ADDI TIONAL SALARY PAID IN FORM OF SALARY, REFLECTED IN THE SALARY SLIP. 9. LD. CIT(A) AFTER TAKING INTO CONSIDERATION THE S UBMISSION OF THE ASSESSEE WHICH HAS BEEN REPRODUCED IN HIS ORDER HAD GIVEN RELIEF TO THE ASSESSEE BY OBSERVING AS UNDER:- ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 9 CMRE WAS GRANTED TO THE EMPLOYEES TOWARDS RUNNING AND MAINTENANCE EXPENDITURE OF THEIR PERSONAL VEHICLES FOR USING SUCH VEHICLES FOR OFFICIAL WORK. CMRE WAS PAID UP TO CEI LING PRESCRIBED FOR DIFFERENT EMPLOYEE GRADES AND ON THE BASIS OF A DEC LARATION BY THE EMPLOYEE EVERY MONTH THAT HE OR SHE INCURRED EXPEND ITURE STATED IN THE DECLARATION ON RUNNING AND MAINTENANCE OF THE V EHICLE FOR OFFICIAL WORK. APPELLANT PAID CMRE AT FIXED RATES ON THE BAS IS OF SUCH DECLARATIONS WITHOUT ANY VERIFICATION. CMRE WAS TH EREFORE NOT REIMBURSEMENT OF ACTUAL EXPENDITURE' ON RUNNING OF PERSONAL VEHICLES. THERE COULD BE CASES OF EMPLOYEES CLAIMING FULL CMR E WITHOUT SPENDING IT ENTIRELY ON RUNNING AND MAINTENANCE OF PERSONAL VEHICLES. CMRE WOULD NOT CONSTITUTE 'FRINGE B ENEFIT' UNDER CLAUSES (F) & (H) OF SECTION 115WB(2) TO THE EXTENT IT WAS NOT INCURRED TOWARDS 'CONVEYANCE' OR 'REPAIR, RUNNING, MAINTENANCE ETC. OF MOTOR CARS'. PAYMENT OF FRINGE BENEFIT TAX ON CMRE BY APPELLANT WOULD NOT THEREFORE EXTINGUISH LIABILITY TO TAX IN EMPLOYEE'S HANDS IN RESPECT OF SUCH UNUTILIZED CMRE PORTION. IT IS TO B E NOTED THAT EVEN IN FBT ERA, ANY ALLOWANCE GRANTED TO MEET THE EXPENDIT URE INCURRED ON CONVEYANCE IN PERFORMANCE OF DUTIES OF AN OFFICE WA S PRESCRIBED FOR THE PURPOSE OF SECTION 10(14)(I) OF THE ACT UNDER R ULE 2BB(L)(C) OF THE I.T. RULES; HOWEVER ONLY TO THE EXTENT TO WHICH SUC H EXPENSES WERE ACTUALLY INCURRED FOR THAT PURPOSE. WHETHER CMRE IS CONSIDERED AS LIABLE TO FBT AND HENCE NOT LIABLE TO TAX IN EMPLOY EE'S HANDS OR AS AN ALLOWANCE'; AS FAR AS APPELLANT WAS CONCERNED, DUE TO FURNISHING OF CERTIFICATE BY THE EMPLOYEES OF HAVING INCURRED MOR E EXPENSE ON VEHICLE RUNNING/MAINTENANCE ON OFFICIAL WORK THAN T HE CMRE PAID, APPELLANT WAS JUSTIFIED IN NOT TAKING INTO ACCOUNT THE CMRE PAID WHILE DEDUCTING TAX AT SOURC FROM SALARY PAID BY CONSIDERING THE SAME TO BE EXEMPT U/S.10(14). IN THIS RE GARD, DECISION BY GUJARAT HIGH COURT IN THE CASE OF APPELLANT, I.E. ( 2000) 254 1TR 121 IS FOLLOWED. HOWEVER, AS FAR AS EMPLOYEE CASES ARE CONCERNED, FOR THE YEARS WHEN FBT WAS PAID BY THE APPELLANT ON CMRE, P ORTION OF CMRE NOT UTILIZED TOWARDS RUNNING & MAINTENANCE EXP ENDITURE ETC. OF THE VEHICLE WOULD CONSTITUTE EMPLOYEE'S TAXABLE SALARY. IN A.Y. 2010-11, I.E. WHEN FBT WAS NOT IN FORCE, APPELLANT CLAIMS TO HAVE DEDUCTED TAX AT SOURCE FROM CMRE PAYMENTS AS PER RU LE- 3 OF INCOME TAX RULES. AFTER ABOLITION OF FBT, CMRE PAID IS TO BE CONSIDERED AS AN 'ALLOWANCE' PRESCRIBED UNDER SECTION 10(14)(I), SINCE CMRE WAS ACTUALLY NOT A REIMBURSEMENT AND HAD AND HAD NO COR RELATION WITH ACTUAL EXPENDITURE ON VEHICLES. RULE 2BB(I)(C) & NO T RULE 3 WOULD ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 10 GOVERN TAXABILITY OF CMRE PAYMENTS IN EMPLOYEE'S HA NDS DUE TO CMRE HAVING NO CORRELATION WITH 'ACTUAL RUNNING & M AINTENANCE CHARGES' OF MOTOR CAR WHICH IS THE CONDITION REQUIR ED TO BE SATISFIED FOR APPLICATION OF RULE 3(2), TABLE II(2). FOR A.Y. 2010-11, AS PER RULE 2BB(1)(C), CMRE WOULD BE EXEMPT IN EMPLOYEE'S HANDS ONLY TO THE EXTENT IT WAS UTILIZED FOR OFFICIAL WORK. TAX DEDUC TED AT SOURCE BY THE APPELLANT FROM CMRE PAYMENTS AS PER RULE 3 VALUATIO N IN AY 10-11 MAY BE LESS THAN TAX DEDUCTIBLE ON CMRE AS PER RULE 2BB(L)(C) IN CASE OF MANY EMPLOYEES. HOWEVER, DUE TO DECLARATION BY EMPLOYEES OF HAVING UTILIZED CMRE FOR OFFICIAL WORK AND FOLLOWIN G GUJARAT HIGH COURT'S DECISION 252 ITR 121, APPELLANT CANNOT BE T REATED AS ASSESSEE IN DEFAULT U/S 201(1) EVEN FOR AY 2010-11. AS FAR A S ASSESSMENTS OF EMPLOYEES IN A.Y. 2010-11 ARE CONCERNED, TAX LIABIL ITY IS TO BE DETERMINED ON CASE TO CASE BASIS BY APPLYING RULE 2 BB(L)(C), TO SUM UP, IT IS HELD THAT APPELLANT CANNOT BE TREATED AS ASSESSEE IN DEFAULT U/S.201(1) FOR NON DEDUCTION OF TAX AT SOURCE FROM CMRE PAYMENTS FOR A.Y.S WHEN FBT WAS IN FORCE, I.E. 2006-07 TO 20 09-10 AS WELL AS AY 2010-11, WHEN FBT WAS NOT IN FORCE. 10. AT THE TIME OF HEARING BOTH THE PARTIES AGREED THAT THE ISSUE INVOLVED IN THIS GROUND IS COVERED BY THE ORDER OF HOBBLE J URISDICTIONAL HIGH COURT DATED 12 TH AUGUST, 2013 IN ASSESSEES OWN CASE IN FAVOUR OF A SSESSEE AND AGAINST THE REVENUE, THEREFORE WE ARE NOT INCLINED TO INTERFERE WITH THE ORDER PASSED BY LD CIT(A) AND THE SAME IS HEREBY UPHELD. THIS GROUND TAKEN BY REVENUE IN ALL THESE APPEALS IS DISMISSED. 11. THE FACTS IN RESPECT OF GROUND NO. 2 HAVE BEEN SUMMARIZED BY LD. CIT(A) AS UNDER:- APPELLANT'S SUBMISSION BEFORE THE ACIT(TDS) WAS TH AT THE HOUSEHOLD GOODS AND FURNITURE ETC, .COVERED UNDER T HE SCHEME WAS ONGC'S PROPERTY AND ADVANCE PAID TO THE EMPLOYEES F OR PURCHASING THESE MOVABLE ASSETS IN THE NAME OF EMPLOYER, I.E. ONGC DID NOT CONSTITUTE THEIR SALARY INCOME, AS PER APPELLANT, U SE OF SUCH ASSETS AND THEIR TRANSFER FOR A CONSIDERATION LESS THAN TH EIR VALUE CONSTITUTED PERQUISITE IN THE HANDS OF EMPLOYEES, VALUE OF WHIC H WAS REQUIRED TO ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 11 BE COMPUTED AS PER RULE 3. ACIT(TDS) NOTED THAT PUR POSE OF SCHEME WAS TO REPLACE INTEREST FREE LUMP SUM ADVANCE SCHEM E AND UNDER THE SCHEME, PERSONAL DISPOSABLE INCOME TO EMPLOYEE WAS INCREASED. ACIT(TDS) WAS OF THE VIEW THAT THOUGH BILL OF PURCH ASE WAS TO BE IN THE NAME OF ONGC, THERE WAS NO ARRANGEMENT TO CONFI RM THAT ITEMS OF FURNITURE/HOUSEHOLD GOODS WERE ACTUALLY PURCHASE D. AS PER ACIT(TDS), PURPOSE OF SCHEME ON ONE HAND WAS TO MAK E BENEFIT OF INCOME OF RS. 1 LAKH TO RS. 4 LAKH AVAILABLE IN THE HANDS OF EMPLOYEES AND ON OTHER HAND, DISGUISE IT AS A PURCHASE BY ONG C, ON WHICH DEPRECIATION COULD BE CLAIMED. ACIT(TDS) NOTED THAT EVEN WINNING OF FURNITURE IN LOTTERY WAS TAXABLE AS INCOME U/S.56 O F THE PERSON CONCERNED AND THE MONEY PAID IN CASH FOR PURCHASING FURNITURE FOR THE EMPLOYEES BY APPELLANT WAS EMPLOYEE'S INCOME, DESER VING TO BE TAXED IN LUMP SUM. ACIT(TDS) HELD THAT PAYMENT MADE IN TH E FORM OF HOUSEHOLD GOODS PURCHASE AMOUNT WAS TO REMUNERATE T HE EMPLOYEE AND WAS TAXABLE INCOME OF THE EMPLOYEE UNDER THE HE AD SALARY FROM WHICH TAX WAS REQUIRED TO BE DEDUCTED AT SOURCE. AC IT(TDS) HELD APPELLANT TO BE ASSESSEE IN DEFAULT U/S 201(1) DUE TO NON DEDUCTION OF TAX AT SOURCE FROM THE ADVANCES FOR HOUSEHOLD GOODS PURCHASE. 12. ASSESSEES SUBMISSION BEFORE LD. CIT(A) AS SUMM ARIZED BY HIM READS AS UNDER:- UNDER THIS SCHEME, ITEMS SUCH AS TV, FRIDGE, MICRO WAVE OVEN, HEALTH EQUIPMENTS, FURNITURE ETC. RANGING FROM RS.L LAKH TO RS. 4 LAKH WERE MADE AVAILABLE TO THE EMPLOYEES BY ADVANCING M ONEY TO THEM TO PURCHASE THESE ITEMS IN THE NAME OF EMPLOYER. THIS ISSUE IS INVOLVED ONLY IN A.Y.2010-11. THROUGH THIS SCHEME, APPELLANT FACILITATED ITS EMPLOYEES TO USE MOVABLE ASSETS OWNED BY THE EMPLOY ER. FOR THE PURPOSE OF DEDUCTION TAX AT SOURCE, APPELLANT COMPA NY CONSIDERED 10% OF COST OF MOVABLE ASSETS AS PERQUISITE IN THEI R HANDS IN ACCORDANCE WITH SECTION 17(2)(VI) READ WITH RULE 3. APPELLANT CHALLENGED ACTION OF ACIT(TDS) IN CONSIDERING ENTIR E PURCHASE COST OF FURNITURE AND OTHER ITEMS (I.E. AMOUNT OF ADVANC E PAID) AS TAXABLE INCOME OF EMPLOYEES. IT WAS SUBMITTED THAT ASSETS P URCHASED WERE OWNED BY THE APPELLANT COMPANY AND NOT BY THE EMPLO YEES AND THE PURCHASE COST DID NOT REPRESENT INCOME OF THE EMPLO YEES. AS PER APPELLANT, HAD THE LEGISLATURE'S INTENTION BEEN TO TAX ADVANCE PAID FOR PURCHASING ASSETS, THERE WOULD HAVE BEEN NO NEED TO PROVIDE FOR SPECIFIC RULES TO TAX THE PERQUISITE FOR USE OF MOV ABLE ASSETS IN THE ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 12 HANDS OF EMPLOYEES. EMPLOYEES WERE MERELY A CONDUIT TO ROUTE THE MONEY TO PURCHASE ASSETS IN THE NAME OF APPELLANT C OMPANY AND MERELY ROUTING THE MONEY THROUGH EMPLOYEES WOULD NO T MAKE THE SAME AS INCOME IN THEIR HANDS. HAD THE EMPLOYER DIR ECTLY PURCHASED THE MOVABLE ASSETS RATHER THAN FOOTING THE SAME THR OUGH ADVANCE PAYMENT TO ITS EMPLOYEES, THE SAME WOULD NOT HAVE B EEN TAXABLE AT ALL AS PER RULE 3. JUST BECAUSE ADVANCE WAS PAID TO THE EMPLOYEES IN ORDER TO PURCHASE ASSETS OF THEIR CHOICE, THE SAME COULD NOT CHANGE NATURE OF TRANSACTION, AS ULTIMATE OWNERSHIP OF ASS ETS BELONGED TO EMPLOYER ITSELF. REGARDING OBSERVATION OF ACIT(TDS) THAT INTEREST FREE ADVANCES WERE GIVEN TO EMPLOYEES TO INCREASE P ERSONAL DISPOSABLE INCOME, APPELLANT SUBMITTED THAT THE ASS ETS WERE PURCHASED IN THE NAME OF EMPLOYER AND THUS, THERE W AS NO INTEREST FREE ADVANCE TO THE EMPLOYEES OR INCREASE IN THEIR PERSONAL DISPOSABLE INCOME. REGARDING ACIT(TDS)'S OBSERVATION WHETHER F URNITURE ETC. WAS ACTUALLY PURCHASED AND ALLEGATION REGARDING THE SCHEME BEING A TOOL TO CLAIM DEPREDATION BY ONGC, APPELLANT SUBMIT TED THAT ACIT(TDS) HAD NOT BROUGHT ANY CASE OF NON PURCHASE OF ASSETS ON RECORD AND CLAIM OF DEPRECIATION BY APPELLANT WAS A S PER LAW. REGARDING OBSERVATIONS OF ACIT(TDS) ABOUT WINNING I N LOTTERY ETC., APPELLANT SUBMITTED THAT THE ADVANCE WAS NOT IN THE NATURE OF INCOME. 13. AFTER TAKING INTO CONSIDERATION THESE SUBMISSIO NS OF THE ASSESSEE LD. CIT(A) HELD THAT AO WAS NOT JUSTIFIED IN TREATING A SSESSEE AS ASSESSEE IN DEFAULT U/S. 201(1) FOR NON DEDUCTING TAX FROM THE AMOUNT OF ADVANCE DISBURSED UNDER A SCHEME TO THE EMPLOYEES BY CONSID ERING IT TO BE FROM SALARY. 14. AFTER HEARING BOTH THE PARTIES AND PERUSING THE RECORD, WE FIND THAT AS PER RULE 3(7)(VII) OF INCOME TAX RULES WHERE EMPLOY ER PROVIDES MOVABLE ASSETS TO ITS EMPLOYEES FOR THEIR PERSONAL USE PERQ UISITE VALUE TO BE TAXED AS SALARY IS DETERMINED @ 10% PER ANNUM OF THE ACTUAL COST OF ASSET. WE FURTHER FIND THAT AS PER CLAUSE (VIII) OF RULE 3(7) THE VALUE OF ASSETS TRANSFERRED TO EMPLOYEE BY THE EMPLOYER IS TO BE CA LCULATED AS PER THE RULE ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 13 AND IS TO BE CONSIDERED AS TAXABLE PERQUISITE IN TH E HANDS OF EMPLOYEE CONCERNED IN THE YEAR OF TRANSFER OF ASSET. IN TH IS CASE INSTEAD OF PURCHASING GOODS BY ITSELF ASSESSEE-COMPANY HAS PROVIDED ADVAN CE TO THE EMPLOYEES TO PURCHASE HOUSEHOLD GOODS AND THESE GOODS WERE TO BE PURCHASED IN THE NAME OF ASSESSEE COMPANY ONLY. THUS IN OUR CONSIDERED O PINION THE POSITION REMAINED SAME AS ENVISAGED UNDER RULE 3(7)(VII)/(VI II) OF INCOME TAX RULE, EVEN THOUGH INSTEAD OF ASSESSEE-COMPANY ITSELF PURC HASING THE GOODS THE SAME WERE PURCHASED BY THE EMPLOYEE IN THE NAME OF ASSESSEE-COMPANY OUT OF ADVANCE GIVEN BY THE ASSESSEE-COMPANY. THERE IS NO DISPUTE ABOUT THE FACT THAT ASSESSEE-COMPANY DEDUCTED TAX AT SOURCE F ROM THE PERQUISITE VALUE OF ADVANCE GIVEN AND GOODS TRANSFERRED ULTIMATELY T O THE EMPLOYEE AT THE END OF 7 YEARS IN ACCORDANCE WITH PROVISIONS OF THE INC OME TAX ACT. SINCE THE GOODS WERE PURCHASED IN THE NAME OF ASSESSEE-COMPAN Y AND NOT THE EMPLOYEE THE ADVANCE WHICH WAS UTILIZED FOR PURCHAS ING GOODS IN THE NAME OF ASSESSEE-COMPANY CANNOT BE SAID TO CONSTITUTE EM PLOYEES INCOME. THE SCHEME WAS DESIGNED IN ACCORDANCE WITH PROVISIONS O F RULE 3(7)(VII)/(VIII)OF INCOME TAX RULE AND WAS IMPLEMENTED ACCORDINGLY BY THE ASSESSEE FOR THE BENEFIT OF ITS EMPLOYEES. THE REVENUE HAS NOT BROU GHT ANY MATERIAL ON RECORD TO SHOW THAT THE ADVANCE WAS NOT UTILIZED IN ACCORDANCE WITH THE SCHEME. WE ARE THEREFORE NOT INCLINED TO INTERFERE WITH THE ORDER OF LD. CIT(A) IN HOLDING THAT ASSESSEE COMPANY WAS NOT ASS ESSEE IN DEFAULT U/S. 201(1) FOR NOT DEDUCTING TAX FROM THE AMOUNT OF ADV ANCE GIVEN UNDER THE SCHEME TO THE EMPLOYEES BY CONSIDERING THE SAME TO BE THEIR SALARY AND THE ORDER PASSED BY HIM IS HEREBY UPHELD. THIS GROUND OF REVENUES APPEAL IS ALSO DISMISSED. 15. IN THE RESULT, APPEALS FILED BY REVENUE ARE DIS MISSED. ITA NOS.155,159, 287,332, 304,308, 270 & 300/AHD/2 012 A.Y. 2010-11 PAGE NO. ONGC VS. ACIT & ITO VS. ONGC 14 16. IN THE COMBINED RESULT, APPEALS FILED BY ASSESS EE AS WELL AS BY REVENUE ARE DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE AT CAPTION PAGE SD/- SD/- (ANIL CHATURVEDI) ( D.K. TYAGI) ACCOUNTANT MEMBER J UDICIAL MEMBER AHMEDABAD : DATED 14/02/2014 AK / COPY OF ORDER FORWARDED TO:- 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,