Friday, December 15, 2006


  • Payment of interest subsidy by the company directly to the Financial Institution, from which employees availed housing loan was a perquisite falling under section 17(2)(iv), because, it was an obligation otherwise dischargeable by the employees. Hence, tax deducted by the employers on the interest subsidy was perfectly correct. K. Rajendran Pillai v. UOI [2006] 156 Taxman 160 (Ker.)
  • If a company manufactures a particular consumable article and starts presenting the same with its emblem and name in a large gathering to a large people, then it may amount to advertisement in a real sense. Presentation of an article with the name of the company to a dignitary or a VIP would not by itself amount to an advertisement.

Motor Industries Co. Ltd. v. DCIT [2006] 156 Taxman 315 (Karn.)
  • Where a non-resident and a non-profit international organization based in USA, having its regional and country offices in India engaged in charitable, scientific and educational activities for population, provided fringe benefits to its employees working in India, it was held that it would be liable to pay Fringe Benefit Tax under section 115WA, even though its income was not chargeable to Income Tax in India.
Population Council, Inc., In re. [2006] 156 Taxman 125 (AAR – New Delhi)
  • Where firm was converted into company, it was entitled to depreciation on number of days for which the asset were used by them. ACIT v. Unity Care & Health Services [2006] 286 ITR 121 (AT)(Bang.)


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