DCIT 10(2), MUMBAI V. SAI OM DEVELOPERS P. LTD, MUMBAI

ITA 2445/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 93034 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-07-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 13-01-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 01-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NAVEEN GUPTA
• Keywords: Deemed dividend

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI . . , , , BEFORE SHRI A.D. JAIN , JUDICIAL MEMBER AND SHRI N.K . BILLAIYA, A CCOUNTANT M EMBER / I .T.A. NO . 2445/MUM/2013 ( / ASSESSMENT YEAR : 2009 - 10 THE DCIT 10(2), AAYAKAR BHAVAN, MUMBAI - 400 020 / VS. M/S. SAI OM DEVELOPERS PVT. LTD., PLOT NO. 216, 3 RD FLOOR, LAALASIS, 11 TH ROAD, CHEMBER, MUMBAI - 400 071 ./ ./ PAN/GIR NO. : AAICS 6806K ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: SHRI NAVEEN GUPTA / RESPONDENT BY : SHRI J.P. BAIRAGRA / DATE OF HEARING : 1 6 . 0 7 .2015 / DATE OF PRONOUNCEMENT : 1 6 .0 7 .2015 / O R D E R PER N.K. BILLAIYA, AM: THIS APPEAL BY THE REVENUE IS PREFERRED AGAINST THE ORDER OF THE LD. CIT(A) - 22 , MUMBAI DT. 24.01.2013 PERTAINING TO ASSESSMENT YEAR 200 9 - 1 0. 2. THE SOLE GRIEVANCE OF THE REVENUE IS THAT THE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS. 1,45,64,933/ - MADE U/S. 2(22)(E) OF THE ACT BY THE AO . ITA. NO . 2445/M/2013 2 3. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF REAL ESTATE DEVELOPERS. DURING THE COURSE OF THE SCRUTINY ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS ASKED TO SUBMIT THE DETAILS OF INTER - CORPORATE LOANS IN WHICH THE ASSESSEE IS HAVING SUBSTANTIAL INTEREST . THE ASSESSEE FILED THE NECESSARY DETAILS WHICH ARE AS UNDER: M/S. SODALITY INVESTMENT LTD., HAS ADVANCED A LOAN OF RS. 1,45,64,933/ - TO M/S. SAI OM DEVELOPERS PVT. LTD (ASSESSEE COMPANY) DURING THE YEAR. THE ASSESSEE HAS ALSO SUBMITTED THE SHAREHOLDIN G PATTERN OF THESE COMPANIES, WHICH IS SHOWN BELOW: SODALITY INVESTMENT PVT. LTD. SAI OM DEVELOPERS PVT. LTD. MR. MOHAN T. KUKREJA - 49.4% MR. MOHAN T. KUKREJA - 50% MR. SUNIL T. KUKREJA - 49.8% MR. SUNIL T. KUKREJA - 50% 3.1. THE ASSESSEE WAS ASKED TO EXPLAIN WHY PROVISIONS OF SEC. 2(22)(E) SHOULD NOT BE INVOKED. IT WAS EXPLAINED BY THE ASSESSEE THAT IT IS NOT A SHAREHOLDER AND THEREFORE PROVISIONS OF SEC. 2(22)(E) ARE NOT APPLICABLE. RELIANCE WAS PLACED ON THE DECISION OF THE TRIBUNAL, SPECIAL BENCH IN THE CASE OF ACIT VS BHAUMIK COLOUR (P) LTD 118 ITD 01. THE CLAIM OF THE ASSESSEE WAS DENIED BY THE AO. THE AO INVOKED THE PROVISIONS OF SEC. 2(22)(E) OF THE ACT AND TREATED LOAN OF RS. 1,45,64,933 / - AS DEEMED DIVIDEND. 4. THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) AND REITERATED ITS CLAIM. AFTER CONSIDERING THE FACTS AND THE SUBMISSIONS, THE LD. CIT(A) RELYING UPON THE DECISION OF THE TRIBUNAL IN THE CASE OF BHAUMIK COLOUR (P) LTD (S UPRA) AND ALSO ON THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS UNIVERSAL MEDICARE (P) ITA. NO . 2445/M/2013 3 LTD 324 ITR 263 HELD THAT SINCE THE ASSESSEE COMPANY IS NOT A REGISTERED SHAREHOLDER, ADDITION U/S. 2(22)(E) CANNOT BE MADE IN THIS CASE. 5. AGGRIEVED BY THIS, THE REVENUE IS BEFORE US. 6. THE LD. DEPARTMENTAL REPRESENTATIVE COULD NOT BRING ANY DISTINGUISHING DECISION IN FAVOUR OF THE REVENUE. 7. THE LD. COUNSEL FOR THE ASSESSEE RELIED UPON THE DECISION OF THE FIRST APPELLATE AUTHORITY. 8. WE HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE FROM THE ORDERS OF THE LOWER AUTHORITIES. WE FIND THAT ON IDENTIC AL SET OF FACTS, THIS ISSUE HAS BEEN DECID ED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE BY THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF UNIVERSAL MEDICARE (P) LTD (SUPRA) WHICH HAS BEEN FOLLOWED BY THE LD. CIT(A) AT PARA 3.7. OF HIS ORDER. WE, THEREFORE, DECLINE TO INTERFERE. 9. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. OR DER PRONOUNCED IN THE OPEN COURT ON 1 6 TH JU LY , 2015 SD/ - SD/ - ( A.D. JAIN ) (N.K. BILLAIYA) /JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 1 6 TH JU LY , 2015 . . ./ RJ , SR. PS ITA. NO . 2445/M/2013 4 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI