Whether, for levy of FBT, meaning of word 'construction' in Sec 115WC is re

Whether, for levy of FBT, meaning of word 'construction' in Sec 115WC is restrictive and includes only civil construction within its realm - NO, rules ITAT

THE issue before the Bench is - Whether, for the levy of FBT, the connotation of the word 'construction' in Sec 115WC is restrictive and includes only civil construction works within its realm. And the final ruling goes in favour of the assessee.

Facts of the case

Assessee Company is engaged in the business of manufacturing of specialized equipment of solid and waste and a liquid waste treatment for industries and communities and these equipments were known as Twin Wire Belt Filter Press for Sludge Management - Major portion of the assessee's activities included construction of civil structures - AO while framing the assessment rejected the submission of the assessee for levyng FBT @ 5% and levied 20% rate. CIT(A) affirmed the order of the AO.

On appeal, the Tribunal held that,

++ as per provisions of sec. 115WC(2)(b) in the case of an employer who is engaged in the business of construction, the value of fringe benefit shall be taken @ 5%. The question before us is that whether or not assessee engaged in the business of construction. The word "construction" has not been defined in the Act. Therefore, its ordinary meaning in common parlance has to be taken. The definitions as given in aforementioned two dictionaries have already been reproduced. If those definitions are kept in mind, the word "construct" cannot be restricted only to civil construction. It includes in its ambit pile or put together, build, make, to form by putting together parts; frame; devise; to draw, as a figure, so as to fulfill given conditions, the result of intellectual perception and consideration of things and ideas receive through the senses. It also includes construction of a housing estate/construct a bridge build, erect, put up, set up, raise, elevate, establish, assemble, manufacture, fabricate, make, construct a plan/theory form, formulate, put together, create, devise, design, invent, compose etc;

++ the word "construction" though mainly connected to the building but it includes within its ambit a bridge under construction building, erection, elevation, establishment, assembly, manufacture, fabrication. It also includes an impressive construction structure, building, edifice, assembly, framework. Therefore, its ambit has not been restricted to only to construction of building. It includes impressive construction structure, building, edifice, assembly, framework etc. The nature of plants made by the assessee-included fixation of certain equipments on land for managing waste and it included also certain degree of civil construction. A structure is created through which the waste is managed by those equipments. It also requires land to establish such erections and to put plant thereon. Therefore, it cannot be said that assessee's activity does not involve business of construction.