09 May 2009
sIR, IF TWO WHEELERS ARE IN THE NAME OF COMPANY AND ITS FUEL EXPENSES ARE ALSO PAID BY COMPANY , WHETHER THESE FUEL EXPENSES ARE COME UNDER FBT ? AND IF COMES THEN WHICH HEAD ? I.E. UNDER LOCAL CONVYANCE OR ANY OTHER HEAD?
11 May 2009
Section 115WB(2)(H) provides that the “expenditure on repair, running (including fuel), maintenance of motorcars and the amount of depreciation thereon is subject to FBT”
No Definition has been provided in the Act for motor cars, so the meaning of Motor cars is to be seen from the definition of Motor car as provided by section 2(26) in the Motor Vehicles Act 1988 which is as following – Motor Car means any motor vehicle other than a transport vehicle, omnibus, roadroller, tractor motor cycle or invalid carriage.
Thus Motor Cycle are not included in the definition of motor car, accordingly the FBT is not applicable on the running, maintenance, insurance or depreciation of motorcycles provided a separate account is maintained in books.
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