Valuation of free services to employees

This query is : Resolved

Kanad Chaudhari (Querist)
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21 March 2009 A company rendering telephone services provides them free of cost to its employees. The employees may use it for official as well as private purposes.
The company does not account for this.
The company's contention is that it incurs no additional cost.
Is the contention of the company valid or is it supposed to transfer a part of its operating expenses to employee remuneration and benefits?

K V Subba Rao

K V Subba Rao (Expert)
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21 March 2009 There is clear position with regard to supply of gas, electricity, water supply and transport provided free of cost in case of employers engaged in the business of respective fields. There appears to no similar provision for telecom companies