M/s. Paspa Distributors Pvt. Ltd., , Kolkata V. ITO, Ward - 12(1), Kolkata, Kolkata

ITA 2273/KOL/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1563 (ITAT-KOLKATA)
• Duration Of Justice: 3 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 06-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PINAKI MUKHERJEE CIT DR RE
• Assessee Lawyers: B K SAHOO
• Keywords: Deemed dividend
• Section: 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA SMC BENCH, KOLKATA [BEFORE S H RI P.M. JAGTAP , HONBLE A CCOUNTANT M EMBER ] I.T.A. NO. 2 273 / KOL/201 7 ASSESSMENT YEAR: 20 08 - 09 M/S. PASPA DISTRIBUTORS PVT. LTD. ... .. ... RESPONDENT BASEMENT, JAYAJYANTI APPARTMENT 2A MANDAVILLA GARDEN GARIAHAT KOLKATA 700 019 [PAN : AADCP 5375 R ] INCOME TAX OFFICER, WARD - 1 2 (1), KOLKATA . . ... APPELLANT AAYKAR BHAWAN P - 7 CHOWRINGHEE SQUARE KOLKATA 700 0 69 APPEARANCES BY: SHRI B.K. SAHOO , FCA , APPEAR ED ON BEHALF OF THE ASSESSEE. SHRI PINAKI MUKHERJEE , ADDL. CIT , DR APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : FEBRUARY 2 2 ND , 201 8 DATE OF PRONOUNCING THE ORDER : FEBRUARY 23 RD , 201 8 O R D E R PER P.M. JAGTAP : - THIS APPEAL FILED BY THE ASSESSE E IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - 1 6 , KOLKATA , DT. 27 / 0 9 /2017, (HEREINAFTER THE LD. CIT (A)), PASSED U/S 250 OF THE INCOME TAX ACT, 1961 (THE ACT ) . 2. THE ASSESSEE IN THE PRESENT CASE IS A COMPANY WHICH FILED ITS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION DECLARING TOTAL INCOME OF RS. 1,982,840/ - . IN THE ASSESSMENT ORIGINALLY COMPLETED UNDER SECTION 143 (3) VIDE AN ORDER DATED 29/11/2010, THE TOT AL INCOME OF THE ASSESSEE WAS DETERMINED BY THE AO AND RS. 2,070,970/ - . THE SAID ASSESSMENT, HOWEVER WAS SUBSEQUENTLY REOPENED BY THE AO ISSUING NOTICE UNDER SECTION 148 OF THE RECORDING THE REASONS AND IN THE ASSESSMENT COMPLETED UNDER SECTION 144/147 OF THE ACT, VIDE AN ORDER DATED 25/03/2014, THE ADDITION OF RS. 2,868,774/ - WAS MADE BY THE AO ON ACCOUNT OF THE AMOUNT OF LOAN RECEIVED BY THE ASSESSEE FROM M/S. PRAPTI FASHIONS PVT. LTD. BY TREATING THE SAME AS THE DEEMED DIVIDEND U/S 2 (22) (E) OF THE ACT. WHILE MAKING THE SAID ADDITION, THE ASSESSING OFFICER REJECTED THE CONTENTION OF THE ASSESSEE 2 I.T.A. NO. 2422/KOL/2017 ASSESSMENT YEAR: 2011 - 12 ESQUIRE EXPRESS & COURIES SERVICES COMPANY THAT THE SAME BEING NOT A REGISTERED SHAREHOLDER OF M/S. PRAPTI FASHIONS PVT. LTD. , THE AMOUNT OF LOAN IN QUESTION COULD NOT BE ADDED IN ITS HANDS AS DEEM ED DIVIDEND U/S 2 (22) (E) OF THE ACT , BY RELYING ON THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. ANKITECH PVT. LTD. [ITA NO. 462 OF 2009] . ON APPEAL, THE LD. CIT(A) CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICER U/S 2 (22) (E) OF THE ACT BY RELYING AGAIN ON THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. ANKITECH PVT. LTD. (SUPRA) . AGGRIEVED BY THE ORDER OF THE LD. CIT(A), THE ASSESSEE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 4. I HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. AS RIGHTLY SUBMITTED BY THE LEARNED COUNSEL FOR THE ASSESSEE, THE ISSUE INVOLVED IN THE PRESENT CASE NOW STANDS FULLY COVERED IN FAVOUR OF THE ASSESSEE BY THE DE CISION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. MADHUR HOUSING AND DEVELOPMENT COMPANY [SLP(C) NO. 19007 OF 2012, DATED 05/10/2017], WHEREIN IT WAS HELD THAT THE LEGAL FICTION CREATED IN SECTION 2(22)(E) OF THE ACT, DOES NOT EXTEND TO A BENEFICI AL SHAREHOLDER AND THE LOANS RECEIVED BY THE ASSESSEE COMPANY FROM ANOTHER COMPANY OF WHICH IT WAS NOT A REGISTERED SHAREHOLDER CANNOT BE ASSESSED AS DEEMED DIVIDEND U/S 2 (22) (E) OF THE ACT. RESPECTFULLY FOLLOWING THE SAID DECISION OF THE HONBLE SUPREME COURT, I DELETE THE ADDITION MADE BY THE AO AND CONFIRMED BY THE LD. CIT(A) U/S 2(22)(E) OF THE ACT BY TREATING THE AMOUNT OF LOANS RECEIVED BY THE ASSESSEE COMPANY FROM M/S. PRAPTI FASHIONS PVT. LTD. AS DEEMED DIVIDEND AS THE ASSESSEE COMPANY WAS NOT THE REGISTERED SHAREHOLDER OF M/S. PRAPTI FASHIONS PVT. LTD. AT THE RELEVANT TIME. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. KOLKATA, THE 23 RD DAY OF FEBRUARY , 201 8 . SD/ - [ P.M. JAGTAP] ACCOUNTANT MEMBER DATED : 23 . 0 2 .201 8 {SC SPS} 3 I.T.A. NO. 2422/KOL/2017 ASSESSMENT YEAR: 2011 - 12 ESQUIRE EXPRESS & COURIES SERVICES C OPY OF THE ORDER FORWARDED TO: 1. M/S. PASPA DISTRIBUTORS PVT. LTD BASEMENT, JAYAJYANTI APPARTMENT 2A MANDAVILLA GARDEN GARIAHAT KOLKATA 700 019 2. INCOME TAX OFFICER, WARD - 12(1), KOLKATA AAYKAR BHAWAN P - 7 CHOWRINGHEE SQUARE KOLKATA 700 069 3. CIT(A) - 4. CIT - , 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER SENIOR PRIVATE SECRETARY HEAD OF OFFICE/ D.D.O. ITAT, KOLKATA BENCHES