FBT on travelling for deputed staff

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Anand Solanki (Querist)
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18 September 2007 Hello,

The company (A Ltd.) has only two staff on deputation from other group company (B Ltd.). There are no other staff in A Ltd. B Ltd. raises a debit note on A Ltd. for travelling expenses, staff welfare expenses incurred by staff on deputation while on duty. Whether FBT is to be paid by A Ltd. or B Ltd.?

R.V.RAO

R.V.RAO (Expert)
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18 September 2007 iNCOME TAX DEPT.circular no 8/2005 dated August 29 of 2005
makes it clear that employer-employee relationship is prerequisite for levy of FBT.
I BELIEVE SINCE B LTD. EMPLOYS THEM AND GETS REIMBURSED THE EXPENSES OF THE EMPLOYEES ,B LTD IS LIABLE FOR FBT.
C.A.R.V.RAO