ACIT, New Delhi V. M/s. A & A Earthmovers Pvt. Ltd., New Delhi

ITA 237/DEL/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 4196 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 8 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-09-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 12-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RC DANDEY
• Assessee Lawyers: SOMIL AGARWAL ADV SHANTNU JAIN
• Keywords: Earning of tax free income; Deemed dividend
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A, NEW DELHI BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER AND MS. SUCHITRA KAMBLE, JUDICIAL MEMBER ITA NO.237/DEL/2015 ASSESSMENT YEAR : 2010-11 ACIT CIRCLE 1(1) NEW DELHI VS. A & A EARTHMOVERS PVT. LTD. C/O. M/S. RRA TAX INDIA, D-28, SOUTH EXTENSION NEW DELHI PAN : AAACC9835G (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SOMIL AGARWAL, ADV., SHANTNU JAIN, ADV. DEPARTMENT BY : SHRI R.C.DANDEY, SR. DR DATE OF HEARING : 25-09-2017 DATE OF PRONOUNCEMENT : 29-09-2017 O R D E R PER R. K. PANDA, AM : 1. THIS APPEAL FILED BY THE REVENUE IS DIRECTED AG AINST THE ORDER DATED 14 TH OCTOBER, 2014 OF THE CIT(A)-IV, NEW DELHI RELATING TO ASSESSMENT YEAR, 2010- 11. 2. GROUND APPEAL NO. 1 OF THE REVENUE READ S AS UNDER : 1. THE LD. CIT(A) HAS ERRED ON FACTS AND CIRCUMSTA NCES OF THE CASE IN DELETING THE DISALLOWANCE OF RS. 2,633/- READ WITH RULE 8D WHEN THE ASSESSEE HAD NOT MADE CLEAR AS TO WHICH INCOME THE INTEREST EXPENDITURE W AS ATTRIBUTABLE. 3. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESS EE COMPANY IS A DEALER OF M/S. JCB LIMITED AND SELLS JCB MACHINES FOR AND ON BEHALF OF THE SAID COMPANY. IT FILED ITS RETURN OF INCOME ON 14 TH OCTOBER, 2010 DECLARING TOTAL INCOME OF RS. 25,18,242/-. DURING THE COURSE OF AS SESSMENT PROCEEDINGS, THE 2 ITA NO.237/DEL/2015 AO OBSERVED THAT THE ASSESSEE HAS SHOWN INVESTMENT IN ITS BALANCE SHEET. HOWEVER, NO SUO MOTO DISALLOWANCE HAS BEEN MADE BY THE ASSESSEE AS PER PROVISION OF SECTION 14A OF IT ACT. HE, THEREFORE, ASKED THE ASSESSEE TO EXPLAIN AS TO WHY THE PROVISIONS OF SECTION 14A READ WITH R ULE 8D SHOULD NOT BE APPLIED. IN RESPONSE TO THE SAID QUERY THE ASSESSEE SUBMITTED THAT SINCE IT HAS NOT RECEIVED ANY EXEMPT INCOME, THEREFORE, NO DISALLOWA NCE CAN BE MADE U/S 14A R.W.R. 8D. 3.1 HOWEVER, THE AO WAS NOT SATISFIED WITH THE EX PLANATION GIVEN BY THE ASSESSEE. ACCORDING TO HIM THE INVESTMENTS MADE BY THE ASSESSEE IN THE SHARES IS TO EARN DIVIDEND INCOME WHICH IS EXEMPT U/S 10(3 4) AND THEREFORE, THE ARGUMENTS OF THE ASSESSEE IS NOT MAINTAINABLE. INVO KING THE PROVISION U/S 14A(2) R.W.R 8D, THE AO MADE DISALLOWANCE OF RS. 2, 770/-. 4. IN APPEAL, THE LD. CIT(A) SUSTAINED ADDITIO N OF RS. 137/- AND DELETED AN AMOUNTING OF RS. 2,633/- BY OBSERVING AS UNDER : I HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF TH E LD. AR FOR THE APPELLANT, PERUSED THE ASSESSMENT ORDER PASSED BY THE AO, HIS REMAND REPORT AND THE REJOINDER FILED BY THE APPELLANT COMPANY. THE TOTAL INVESTMENTS MADE BY THE APPELLANT COMPANY IN UNQUOTED SHARES IS RS. 27,400/ -. THERE IS NO CHANGE IN THE INVESTMENT MADE AS COMPARED TO PRECEDING YEAR. APPE LLANT COMPANY HAS SUBSTANTIAL CAPITAL AND RESERVES. THE AO HAS NOT BR OUGHT ON RECORD ANYTHING TO SHOW AS TO HOW THE INTEREST BEARING FUNDS WERE USED BY THE APPELLANT COMPANY TO MAKE INVESTMENTS IN THE EQUITY SHARES WHEN ASSESSEE COMPANY HAS SUBSTANTIAL NON BEARING INTEREST FUNDS. THEREFORE, I AM OF THE OPIN ION THAT THE AO HAS INVOKED THE PROVISIONS OF CLAUSE (II) OF RULE 8D IN A MECHANICA L MANNER WITHOUT IDENTIFYING THAT THESE INVESTMENTS MADE BY THE APPELLANT FOR A TOTAL AMOUNT OF RS. 27,400/- WAS OUT OF INTEREST BEARING FUNDS. THEREFORE, THE ADDITION OF RS. 2,633/- CAN NOT BE SUSTAINED AND HENCE DELETED. HOWEVER, THE ADDITION OF RS. 137/- UNDER CLAUSE (III) OF RULE 8D IS SUSTAINED, AS IT CANNOT BE RULED OUT THAT ADMINISTRATIVE MACHINERY IS USED TO MANAGE THE INVESTMENTS MADE. THIS GROUND OF APPEAL IS PARTLY ALLOWED. 4.1. AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE R EVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSION MADE BY BOTH THE SIDES, PERUSED THE ORDER OF THE AO AND CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSED. WE HAVE ALSO CONSIDERED THE VARIOUS DECIS IONS CITED BEFORE US. WE 3 ITA NO.237/DEL/2015 FIND THE AO MADE DISALLOWANCE OF RS. 2770/- U/S 14A R.W.R. 8D OUT OF WHICH THE LD. CIT(A) HAS DELETED ADDITION OF RS. 2633/-. THE SUBMISSION OF THE ASSESSEE BEFORE THE AO THAT IT HAS NOT RECEIVED ANY DIVIDEND INCOME HAS NOT BEEN CONTROVERT BY THE REVENUE. THE HONBLE DELHI H IGH COURT IN THE CASE OF CIT VS. HOLCIM INIDA (P) LTD., VIDE ITA NO. 486/201 4 & ITA NO. 299/2014, ORDER DATED 5 TH SEPTEMBER, 2014 HAS HELD THAT NO DISALLOWANCE U/S 14A CAN BE MADE WHEN ASSESSEE HAS NOT RECEIVED ANY DIVIDEND INCOME. SINCE THE ASSESSEE IN THE INSTANT CASE ADMITTEDLY HAS NOT RECEIVED ANY DIVIDEND INCOME DURING THE YEAR, THEREFORE, WE DO NOT FIND ANY INFI RMITY IN THE ORDER OF THE CIT(A) DELETING THE ADDITION MADE BY THE AO. THE GR OUND APPEAL NO. 1 BY THE REVENUE IS DISMISSED. GROUND APPEAL NO. 2 OF THE REVENUE IS READS AS UND ER : 2. THE LD. CIT(A) HAS ERRED ON FACTS AND IN THE CI RCUMSTANCES OF THE CASE IN DELETING THE ADDITION OF RS. 7,35,922/- MADE BY THE AO ON ACCOUNT OF DIFFERENCE BETWEEN TDS AS PER RETURN AND AS PER FORM 26AS OBSE RVING THAT THERE WAS NO ACTUAL RECEIVING OF THE AMOUNT IN THE HANDS OF THE ASSESSEE BY IGNORING THE FACT THAT THE PROVISIONS OF SEC. 198 WHICH WERE INVOKED BY TH E AO FOR MAKING THE ADDITION IS A DEEMING PROVISION AND VERIFICATION OF ACTUAL RECE IPTS IN THE HANDS OF THE ASSESSEE IS NOT REQUIRED. 6. FACTS OF THE CASE, IN BRIEF, ARE THAT THE AO DUR ING THE COURSE OF ASSESSMENT PROCEEDINGS OBSERVED THAT THE FIGURES AS PER THE TDS CLAIMED IN THE COMPUTATION OF INCOME AND THE TDS CLAIMED AS PER RE TURN OF INCOME ARE DIFFERENT. HE, THEREFORE, ASKED THE ASSESSEE TO FIL E FORM NO. 26AS. THE ASSESSEE FURNISHED THE DETAILS ACCORDING TO WHICH THE TDS AS PER THE INCOME TAX RETURN IS RS. 41,56,824/- WHEREAS THE TDS AS PER 26AS IS RS. 41,01,982. THUS, THERE WAS DIFFERENCE OF RS. 54,842/- IN RESPECT OF M/S. L & T AMJV TAPOVAN. HOWEVER, THE AO NOTED THAT THE FIGURE AS PER THE IT R IS RS. 41,77,781/- WHEREAS THE TDS AS PER FORM NO. 26AS IS RS. 41,01,9 82/- AND THE DIFFERENCE WAS RS. 75,799/-. HE, THEREFORE, ASKED THE ASSESSEE TO RECONCILE THE DIFFERENCE. THE ASSESSEE AGAIN EXPLAINED THAT THE DIFFERENCE OF RS. 75,799/- RELATES TO M/S. L & T AMJV TAPOVAN. REJECTING THE VARIOUS EXPLANAT ION GIVEN BY THE 4 ITA NO.237/DEL/2015 ASSESSEE TO SUBSTANTIATE SUCH DIFFERENCE, THE AO MA DE ADDITION OF RS. 7,35,922/- TO THE INCOME OF THE ASSESSEE. 7. IN APPEAL THE LD. CIT(A) AFTER OBTAINING A REMAN D REPORT FROM THE AO DELETED THE ADDITION BY OBSERVING AS UNDER : I HAVE CONSIDERED THE OBSERVATIONS MADE BY THE AO IN THE IMPUGNED ORDER, HIS REMAND REPORT, WRITTEN SUBMISSIONS MADE BY THE APPELLANT COMPANY AND SUBMISSIONS MADE IN THE REJOINDER FILED. I HAVE ALS O PERUSED THE RECONCILIATION STATEMENT FILED BY THE APPELLANT COMPANY, AND COPY OF LEDGER ACCOUNT OF M/S. L&T AMJV TAPOVAN WHICH ARE PART OF THE PAPER BOOK AT PB 142 AND 145. ON PERUSAL OF THE RECONCILIATION STATEMENT FILED AND TRANSACTIONS / ENTRY RECORDED RELATING TO M/S. L&T - AM JV, IT IS FOUND THAT THE APPELLANT COMPANY HAS CLAIMED CREDIT OF RS. 2,10,392/- AS AGAINST AMOUNT DEDUCTED AND DEPOSITED BY THEM AMOUNTING TO RS. 85,514/- AS PER 26AS. THUS, THE ASSESSEE COMPANY HA S CLAIMED EXCESS TDS AMOUNTING TO RS. 1,24,878/- IN RESPECT OF THIS PART Y WHICH IS ALSO ESTABLISHED FROM THE RECONCILIATION STATEMENT FILED AND PLACED AT PB 142. AS REGARDS TDS DEDUCTED AMOUNTING TO RS. 85,514/- DURING THE YEAR UNDER CON SIDERATION, CORRESPONDING NET RECEIPTS APPEAR IN THE LEDGER ACCOUNT OF M/S. L&T-A M JV I.E. RS. 5,76,140/- [RS. 649757-73,617 (TDS)], AND RS. 93,103/- [RS. 105000- 11897 (TDS)]. THUS, THE TDS DEDUCTED AND DEPOSITED BY M/S. L&T-AM JV IN THE NAM E OF THE APPELLANT COMPANY FOR THE YEAR UNDER CONSIDERATION WORKS OUT TO RS.85 ,514/- (11,897+73,617), AS AGAINST CREDIT OF TDS CLAIMED OF RS. 2,10,392/-BY T HE APPELLANT COMPANY IN RETURN OF INCOME FILED. NO OTHER RECEIPTS ARE FOUND CREDIT ED IN THE ACCOUNT .OF THIS PARTY, AS SUCH QUESTION OF MAKING ANY ADDITION ON NOTIONAL BASIS DOES NOT ARISE, AS APPELLANT COMPANY HAS NOT RECEIVED ANY MORE RECEIPT S FROM THIS PARTY OTHER THAN WHAT HAS BEEN RECORDED BY IT IN ITS BOOKS OF ACCOUN TS AND OBSERVED FROM THE ACCOUNT OF M/S L&T - AM JV PLACED AT PB 145 OF THE PAPER BOOK. FURTHERMORE, THE APPELLANT COMPANY HAS ALSO ADMITTED THIS FACT THAT IT HAS MISTAKENLY CLAIMED EXCESS CREDIT OF RS. 1,24,878/- WHICH IN FACT BELONGS TO T HE IMMEDIATE PRECEDING YEAR AND HAS CLAIMED THE SAME IN THE IMMEDIATE PRECEDING YEA R AND ITS CORRESPONDING INCOME HAS ALSO BEEN SHOWN IN THAT YEAR. IN VIEW OF THESE OBSERVATIONS AND FACTS EMANATING FROM THE EVIDENCES PLACED ON RECORD, THE EXCESS CREDIT OF TDS CLAIMED FOR AN AMOUNT OF RS. 1,24,878/- IS DIRECTED TO BE W ITHDRAWN SINCE THIS TDS IS OF THE IMMEDIATE PRECEDING YEAR, FOR WHICH INCOME HAS ALSO BEEN TAXED IN THE IMMEDIATE PRECEDING YEAR. THEREFORE, THE ADDITION MADE OF RS. 7,35,922/- IS DELETED, SINCE NO SUCH RECEIPTS ARE FOUND TO HAVE BEEN RECEIVED BY TH E APPELLANT COMPANY, AND TDS AMOUNTING TO RS. 1,24,878/- HAS BEEN WRONGLY CLAIME D BY THE APPELLANT COMPANY IN THE IMPUGNED ASSESSMENT YEAR. THIS GROUND OF APPEAL IS DISPOSED OFF IN THE MANNER AS INDICATED ABOVE AND THE AO IS DIRECTED TO WITHDR AW THE CREDIT OF TDS FOR AN AMOUNT OF RS. 1,24,878/-. 8. AGGRIEVED WITH SUCH ORDER OF CIT(A), REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 5 ITA NO.237/DEL/2015 9. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES, PERUSED THE ORDERS OF THE AO AND THE CIT(A) AND THE PAPER B OOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECIS IONS CITED BEFORE US. WE FIND THE AO MADE ADDITION OF RS. 7,35,922/- ON ACCO UNT OF DIFFERENCE BETWEEN THE TDS AS PER INCOME TAX RETURN AND TDS AS PER FO RM NO. 26AS AND MADE THE ADDITION ON NOTIONAL BASIS APPLYING THE PROVISION O F SECTION 198 OF THE IT ACT. WE FIND THE LD. CIT(A) AFTER OBTAINING A REMAND REP ORT FROM THE AO AND AFTER CONSIDERING THE REJOINDER OF THE ASSESSEE TO SUCH R EMAND REPORT HAS DELETED THE ADDITION, THE DETAILS OF WHICH ARE ALREADY REPRODUC ED IN THE PRECEDING PARAGRAPH. THE FACTUAL FINDING GIVEN BY CIT(A) WHIL E DELETING THE ADDITION COULD NOT BE CONTROVERTED BY THE LD. DR. UNDER THES E CIRCUMSTANCES AND IN ABSENCE OF ANY CONTRARY MATERIAL BROUGHT TO OUR NOT ICE AGAINST THE FACTUAL FINDING GIVEN BY THE CIT(A), WE FIND NO INFIRMITY I N THE ORDER OF THE CIT(A). ACCORDINGLY THE SAME IS UPHELD AND THE GROUND RAISE D BY THE REVENUE IS DISMISSED. GROUND APPEAL NO. 3 OF THE REVENUE IS READS AS UNDE R : 3. THE LD. CIT(A) HAS ERRED ON FACTS AND THE CIRCU MSTANCES OF THE CASE IN DELETING THE ADDITION OF RS. 37,06,817/- AS DEEMED DIVIDEND. 10. FACTS OF THE CASE, IN BRIEF, ARE THAT THE AO DU RING THE COURSE OF SCRUTINY PROCEEDINGS OBSERVED THAT THE ASSESSEE COMPANY HAD AN OPENING CREDIT BALANCE OF LOAN AMOUNTING TO RS. 2,13,61,105/- FROM M/S. R. D. FINLEASE PRIVATE LIMITED (HEREINAFTER REFERRED TO AS RDFPL) AND ASS ESSEE COMPANY HAD FURTHER RECEIVED LOAN OF RS. 25,20,000/- DURING THE IMPUGNE D ASSESSMENT YEAR. ASSESSES COMPANY ALSO CREDITED THEIR ACCOUNT WITH INTEREST P AYABLE ON LOAN BY AN AMOUNT OF RS. 26,78,111/-. THE BALANCE SHEET OF RDF PL SHOWED ACCUMULATED PROFITS OF RS. 37,06,817/- AS ON 31.03.2010. THE SH ARE HOLDING PATTERN OF APPELLANT COMPANY REVEALED THAT 74.68% SHARES WERE HELD BY SH. ASHISH ANAND 6 ITA NO.237/DEL/2015 AND 12.01% BY MR. AMARPREET ANAND WHO WERE ALSO SHA REHOLDERS IN RDFPL FOR MORE THAN 10% OF THE SHAREHOLDING. ACCORDINGLY THE ASSESSES WAS ASKED TO SHOW CAUSE AS TO WHY LOAN FROM R.D. FINLEASE TO APP ELLANT COMPANY BEING COVERED U/S 2(22)(E) NOT BE TREATED AS DEEMED DIVID END. 11. THE ASSESSEE IN ITS REPLY SUBMITTED THAT FRESH LOAN RECEIVED FROM RDFPL DURING THE YEAR WAS RS. 25,20,000/- ONLY OUT OF WHI CH RS 12,50,000/- WAS REPAID TO THEM AND RS. 24,10,354/- (NET OF TDS) WAS CREDITED TO THEM ON ACCOUNT OF INTEREST AS ON 31.03.2010. 12 . THE AO OBSERVED THAT THE REPAYMENT CANNOT BE ADJUST ED AGAINST THE FRESH LOANS AND IS TO BE ADJUSTED WITH THE OPENING BALANC E. THE AO CONCLUDED THAT INTEREST CREDITED HAS ALSO TAKEN THE SHAPE OF LOAN, AND SINCE THERE WERE ACCUMULATED PROFITS OF RS. 37,06,817/- IN RDFPL, AN D MR. ASHISH ANAND AND MR. AMARPREET ANAND WERE HAVING QUALIFYING QUANTUM OF SHARE HOLDINGS IN BOTH THE COMPANY, THE LOANS RECEIVED BY THE ASSESSE E COMPANY TO THE EXTENT OF ACCUMULATED PROFIT I.E. RS. 37,06,817/- IS DEEMED D IVIDEND INCOME IN THE HANDS OF THE ASSESSEE COMPANY. HE ACCORDINGLY MADE ADDITI ON OF RS. 37,06,817/- AS DEEMED DIVIDEND U/S 2(22)(E) OF THE I.T.ACT, 1961. 13. IN APPEAL THE LD. CIT(A) DELETED THE ADDITION B Y OBSERVING AS UNDER : 14.3. I HAVE CAREFULLY CONSIDERED THE SUBM ISSIONS OF ID. AR AND PERUSED THE ORDER PASSED BY THE AO. IT IS SEEN THAT THE AO HAS MADE THE ADDITION ON THE GROUND THAT SHRI ASHISH ANAND WAS HAVING 74.58% SHAREHOLDI NG AND MR. AMARPREET ANAND WAS HAVE 12.01% SHAREHOLDING IN THE APPELLANT COMPA NY AND THESE PERSONS WERE HOLDING MORE THAN 10% SHARES IN M/S. RDFPL. IT IS A SETTLED POSITION OF LAW THAT ADDITION ON ACCOUNT OF DEEMED DIVIDEND CAN BE MADE ONLY IN THE HAND OF SHAREHOLDER WHO IS A REGISTERED AS WELL AS BENEFICI AL OWNER OF THOSE SHARES. SINCE IN THIS CASE SHRI ASHISH ANAND AND SHRI AMARPREET A NAND WHO ARE THE REGISTERED AND BENEFICIAL SHAREHOLDER, THE ADDITION ON ACCOUNT OF DEEMED DIVIDEND CANNOT BE MADE IN THE HANDS OF THE COMPANY. HOWEVER, THE AO I S AT LIBERTY TO TAKE APPROPRIATE ACTION IN THE HANDS OF SHRI ASHISH ANAN D AND SHRI AMARPREET ANAND. HONBLE DELHI HIGH COURT IN THE CASE OF CIT V. ANKITECH PVT. LTD. (2011) 57 DTR 345 / 242 CTR 129 / (2011) TAX LR 629 / (2012) 340 ITR 14 HAS HOLD THAT WHERE ASSESSEE IS NOT A SHAREHOLDER OF THE PAYING C OMPANY, THE DIVIDEND IS NOT 7 ITA NO.237/DEL/2015 ASSESSABLE' IN ITS HANDS. HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT V. UNIVERSAL MEDICARE (P.) LTD. (2010) 324 ITR 263 HELD THAT PROFIT IN THE FORM OF DIVIDEND CAN BE DISTRIBUTED TO ONLY SHAREHOLDERS OF THAT COMPANY AND SUCH DIVID END CANNOT BE GIVEN TO NON- MEMBERS. ADMITTEDLY APPELLANT COMPANY IS NOT A SHAR EHOLDER OF RDFPL WHO HAVE GIVEN LOAN TO THE APPELLANT COMPANY. SUCH LOAN IS A LSO NOT GIVEN BY M/S RDFPL TO SHRI ASHISH ANAND OR AMARPREET ANAND. IT IS NOT OUT OF PLACE TO MENTION THAT SIMILA R ADDITION WAS MADE BY THE AO IN THE IMMEDIATE PRECEDING YEAR TOO, AND THAT ADDITION WAS ALSO DELETED BY ME OBSERVING AS UNDER:- THE APEX COURT IN THE CASE OF C. P. SARATHY MU DALIAR CONSIDERING THE PROVISIONS OF SECTION 2(6A)(E) OF THE I. T. ACT, 1922, WHICH W AS SYNONYMOUS TO SECTION 2(22)(E) OF THE CURRENT ACT, HELD THAT SHAREHOLDER IN THE CO NTEXT OF DEEMED DIVIDEND REFERRED TO ONLY REGISTERED SHAREHOLDER. THE ABOVE VIEW WAS ALSO CONFIRMED BY THE APEX COURT IN THE CASE OF RAMESHWARLAL SANWARMAL V. CIT (1980) 122 ITR 1 14.4. RESPECTFULLY FOLLOWING THE RATIO OF THE ABO VE JUDGMENTS ON THE ISSUE, THE ADDITION OF RS.42,97,686/- IN THE HANDS OF THE APPE LLANT COMPANY CANNOT BE SUSTAINED AS THE AMOUNT CAN BE BROUGHT TO TAX ONLY IN THE HANDS OF THE SHAREHOLDERS OF THE LENDER COMPANY, I.E. SHRI ASHISH ANAND AND S HRI AMARPREET ANAND AND NOT IN HANDS OF THE APPELLANT COMPANY WHICH IS NOT A REGIS TERED SHAREHOLDER OF THE LENDER COMPANY. IN VIEW OF THE ABOVE DISCUSSION, THE AFORE SAID ADDITION IN THE HANDS OF THE APPELLANT COMPANY STANDS DELETED. IT IS NOT OUT OF PLACE TO MENTION HERE T HAT LD. AR ARGUED THAT THE AMOUNT GIVEN BY M/S RDFCL TO THE APPELLANT COMPANY IS NOT IN THE NATURE OF LOAN AND ADVANCE OF THE NATURE AS ENVISAGED U/S 2(22)(E). TH E ID. AR STRESSED THAT THE LOAN TAKEN BY THE APPELLANT COMPANY IS FOR ITS BUSINESS PURPOSES WHICH WAS TAKEN PRIOR TO ASSESSMENT YEAR UNDER CONSIDERATION. DURING THE YEAR, THE ASSESSEE RECEIVED FURTHER LOAN AMOUNTING TO RS. 25,20,000/-. THE ASSE SSEE COMPANY ALSO PAID INTEREST AMOUNTING TO RS. 26,78,171/- TO RDFPL ON ACCOUNT OF INTEREST PAYABLE TO THEM ON LOAN ARRANGED THROUGH THEM. I AM NOT GOING IN TO VE RIFICATION OF THESE FACTS SINCE THIS ADDITION HAS BEEN DELETED ON THE BASIS OF JUDG MENT OF HON'BLE DELHI HIGH COURT ON THE PRELIMINARY GROUND AS DISCUSSED ABOVE. THE A O SHALL BE AT HIS LIBERTY TO EXAMINE THE TAXABILITY OF THIS AMOUNT IN THE HANDS OF SHRI ASHISH ANAND AND SHRI AMARPREET ANAND IN ACCORDANCE WITH LAW AND FACTS. 14. AGGRIEVED WITH SUCH ORDER OF CIT(A), THE REVEN UE IS IN APPEAL BEFORE US. 15. AFTER HEARING BOTH THE SIDES, WE FIND AN IDENTI CAL ISSUE HAD COME UP BEFORE THE TRIBUNAL IN ASSESSEES OWN CASE VIDE ITA NO. 2098/DEL/2013 ORDER DATED 29.7.2015 FOR ASSESSMENT YEAR 2009-10. THE TR IBUNAL DECIDED THE ISSUE AND DELETED THE ADDITION BY OBSERVING AS UNDER : 8 ITA NO.237/DEL/2015 3. WE HAVE HEARD ARGUMENTS OF BOTH THE SIDES AND C AREFULLY PERUSED THE RELEVANT MATERIAL PLACED ON RECORD. LD. COUNSEL FOR THE ASSESSEE, AT THE VERY OUTSET, POINTED OUT THAT THE ISSUE IS SQUARELY COVERED IN F AVOUR OF THE ASSESSEE BY THE ORDER OF THE HONBLE JURISDICTIONAL HIGH COURT OF DELHI I N THE CASE OF CIT VS. ANKITECH PVT. LTD. (2012) 340 ITR 14 (DEL) AND ALSO SUBMITTE D THAT FOR THE PURPOSE OF SECTION 2(22)(E) OF THE INCOME TAX ACT, 1961, THE AMOUNT RE CEIVED BY THE ASSESSEE AS ADVANCES AND LOANS WOULD BE TREATED AS DIVIDEND WIT HIN THE MEANING OF SAID PROVISIONS OF THE ACT AND ADVANCES TO THE ASSESSEE COMPANY FROM ANOTHER COMPANY WHEREIN PERSONS HAVING SUBSTANTIAL INTEREST IN THE ASSESSEE COMPANY AND ANOTHER COMPANY WHICH GAVE THE LOAN HAVING SUBSTANTIAL INTE REST, THEN ALSO IF THE ASSESSEE RECIPIENT COMPANY OF LOAN IS NOT SHAREHOLDER OF COM PANY OF OTHER COMPANY WHICH GAVE THE LOAN, THEN THE AMOUNT OF LOAN IS NOT ASSES SABLE AS DEEMED DIVIDEND U/S 2(22)(E) OF THE ACT. 16. SINCE THE FACTS OF THE INSTANT APPEAL ARE IDENT ICAL TO THE FACTS DECIDED BY THE TRIBUNAL IN ASSESSEES OWN CASE IN THE IMMEDIAT ELY PRECEDING ASSESSMENT YEAR, THEREFORE, RESPECTFULLY FOLLOWING THE DECISIO N OF THE TRIBUNAL IN ASSESSEES OWN CASE AND IN ABSENCE OF ANY CONTRARY MATERIAL B ROUGHT TO OUR NOTICE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) DELET ING THE ADDITION. ACCORDINGLY THE SAME IS UPHELD AND THE GROUND RAISED BY THE REV ENUE IS DISMISSED. 17. IN THE RESULT THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN ON THIS 29 TH DAY OF SEPTEMBER, 2017. SD/- SD/- SD/- SD/- (SUCHITRA KAMBLE) (R. K. P ANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 29-09-2017 *BINITA* COPY OF ORDER TO: - 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT 4) THE CIT(A) 5) THE DR, I.T.A.T., ALLAHABAD. BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, ALLAHABAD 9 ITA NO.237/DEL/2015 S.NO. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 29.09.2017 SR. PS/PS 2 DRAFT PLACED BEFORE AUTHOR 29 .09.2017 SR. PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/AM 5 APPROVED DRAFT COMES TO THE SR. PS/PS SR. PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR. PS/PS 7 DATE OF UPLOADING OF ORDER SR. PS/PS 8 FILE SENT TO BENCH CLERK SR. PS/PS 9 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 10 DATE ON WHICH FILE GOES TO THE A.R. 11 DATE OF DISPATCH OF ORDER