CHARGABILITY OF FBT

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MEGHNA S VARIA (Querist)
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28 January 2008 AS PER INCOME TAX ACT, TAX CAN ONLY BE LEVIED ON INCOME. AS PER DEFINATION OF INCOME, WHATEVER FBT IS CHARGED ON EXPENSES IS NOT COVERED THEN CHARGABILITY IS VALID OR NOT ?
PLEASE GIVE ME ANSEWER.

CA. Dashrath Maheshwari

CA. Dashrath Maheshwari (Expert)
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28 January 2008 FBT is different from Income tax and is a valid charge on expenses

MEGHNA S VARIA

MEGHNA S VARIA (Querist)
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28 January 2008 FBT IS LEVIED UNDER INCOME TAX ? ISN'T IT ?

CA Mani

CA Mani (Expert)
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28 January 2008 Even though FBT is Charged under Income tax Act on Expenses, Our FM's view is that it's an indirect evasion of tax. Eg: Reimbursements will not be taxed in E'ees hands & E'er's hands. To avoid that FBT was introduced. Moreover, It's copied from Foreign Laws as similar to other laws.

It's chargeability is valid if you consider FM's contention.

CA Hemant T Dewani

CA Hemant T Dewani (Expert)
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28 January 2008 fbt is preesumptive tax just like expenditure tax so it is applicable to all assesses except indivudal huf and specified assesses u/s 115w(b) it is taxable

CA. Dashrath Maheshwari

CA. Dashrath Maheshwari (Expert)
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28 January 2008 because its charge created in the enactment which is part of Income tax act at present, its a valid & legal taxation.

Manish Agarwal

Manish Agarwal (Expert)
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28 January 2008 Several petitions have been filed before various HIgh courts challenging the constitutional validity of FBT. As far as I know the Hon'ble Kolkata High Court has even granted stay on FBT in the case of SREI.A final decision of the apex court is still awaited.

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