Is A Contractor Filing Return Under 44AD Scheme Liable To FBT?

What is the liability of F.B.T in the case of contractor who is coming u/s 44AD.?
Vishal Jaiswal , Varanasi

FBT is a tax on the fringe benefits made available by the Employer to employee.Fringe Benefit Tax has no relationship with kind of income a person is earning. In fact , even if one does not earn income , one may be liable to FBT.Therefore , you should see whether the contractor is falling under one of the following kind of Employers who are only are liable to Fringe Benefit Tax

1. Company
2. Firm or AOP or Body Of Individuals
3. Trust
4. Local Authority
5. Artificial Juridical Authority

So , if the contractor is not falling any of the aforesaid categories of employer, FBT is not chargeable on him.

And then even if he falls under one of the aforesaid catagories, the contractor is liable for FBT only if it is spending on employee’s fringe benefits as defined under section 115WB(1) & 115WB(2) of the I T Act.