08 January 2009
Circular no 8/2005 says there should necessarily be an employer employee relationship to levy FBT. If the issue raised is viewed in that angle Mr.Jitender's answer is correct. But the term employee has not been defined anywhere in the Income Tax Act,1961. Consequently,it means any employee-full time or part time, regular or casual,employee doing manual work or otherwise. Ref-Taxmann's Taxation of fringe Benefits-4th edition -page 28. In view of this, according to me, the issue is debatable.
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