11 May 2011
Suppose a company (any company...for eg FMCG) approaches some bank. Company negotiates with bank to provide concessional loans to employees of company(say 11% instead of standard rate of 12%). company doent pay anything to bank for this benefit. Bank also agrees to this concessional rate on consideration of volume of trade which could be earned from this. Will this 1% be taxable as perquisite in hand of employees??? (Refer rule 3 of IT rules)
11 May 2011
Will Bank giving loan to employee of company be included in term "By the employer or any other person on his behalf"? This question is relevant as company is negotiating with bank.
11 May 2011
No, it will be not included in the perquisite. because company has not paid the loan to employee and further bank has provided loan on its own and not on behalf of company, so this concessional rate will not be taxable as a perquisit in the hand of employee. company is only negotioating on behalf of employee, and company is not paying anything to the bank for this concessional rate of loan
11 May 2011
If we keep aside the commercial viewpoint, and just focus on technicalities of tax, will the agreement between company and bank change the answer?
11 May 2011
If we keep aside the commercial viewpoint, and just focus on technicalities of tax, will the agreement between company and bank change the answer?
CAclubindia
