ITO 22(2)(3), NAVI MUMBAI V. SATYAPAL RAJPAL BAKSHI, MUMBAI

ITA 2456/MUM/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 2244 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 6 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-11-2016
• Appeal Filed By: Department
• Bench Allotted: E
• Assessment Year: 2007-2008
• Appeal Filed On: 11-04-2014
• Court: TRIBUNAL
• Department Lawyers: AKHILENDRA YADAV
• Keywords: Deemed dividend

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER AND SHRI RAM LAL NEGI, JUDICIAL MEMBER I.T.A. NO.2456/M/2014 (AY: 2007 - 2008 ) ITO - 27(3)(2), RNO. 425, 4 TH FLOOR, VASHI RLY. STATION COMPLEX, VASHI, NAVI MUMBAI. / VS. M/S. SATYAPAL RAJPAL BAKSHI, DEV INDUSTRIAL ENTERPRISES, RAJI 11/12, R.B. MEHTA ROAD, GHATKOPAR (E), MUMBAI 400 077. ./ PAN : AABPB7508H ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI AKHILENDRA YADAV, DR / RESPONDENT BY : NONE / DATE OF HEARING : 03.11.2016 / DATE OF PRONOUNCEMENT : 03 .11.2016 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE REVENUE ON 11.4.2014 IS AGAINST THE ORDER OF THE CIT (A) - 33, MUMBAI DATED 29.1.2014 FOR THE ASSESSMENT YEAR 2007 - 2008. IN THIS APPEAL, REVENUE RAISED THE FOLLOWING GROUNDS WHICH READ AS UNDER: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT (A) ERRED IN DIRECTING THE AO TO RESTRICT THE PENALTY ON THE DEEMED DIVIDEND TO THE AMOUNT OF RS. 7,45,787/ - AS AGAINST THE ADDITION U/S 2(22)(E) MADE BY THE AO OF RS. 39,51,877/ - . 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT (A) ERRED IN HOLDING THAT FOR LEVYING OF PENALTY, CLOSING CREDIT BALANCE OF RS. 7,45,787/ - AS ON 30.3.2007 SHOULD ONLY BE TAKEN AS DEEMED DIVIDEND WITHOUT APPRECIATING THE FACT T HAT EVERY TRANSACTION OF LOANS MADE BY M/S. TALPASYA ENGG. WORKS PVT LTD HAS TO BE TAKEN AS DEEMED DIVIDEND UNDER THE PROVISIONS OF SECTION 2(22)(E) OF THE ACT. 2. BEFORE US, NONE APPEARED ON BEHALF OF THE ASSESSEE TO REPRESENT ITS CASE. WITH THE HELP O F THE LD DR, WE PROCEED TO ADJUDICATE THIS APPEAL. BRIEF FACTS GIVE RAISE TO THE ABOVE GROUNDS INCLUDE THAT THE AO MADE ADDITION IN THE ASSESSMENT U/S 2(22)(E) OF THE ACT AMOUNTING TO RS. 39,51,877/ - . ACCORDINGLY, O N THE SAID ADDITION, PENALTY AMOUNTING TO RS. 13,39,513/ - WAS LEVIED U/S 271(1)(C) OF THE ACT. ON THE QUANTUM APPEAL, TRIBUNAL GRANTED RELIEF TO THE ASSESSEE TO THE EXTENT OF RS. 32,06,090/ - AND RETAINED THE ADDITION OF RS. 7,45,787/ - . EVENTUALLY, PENALTY 2 RELATABLE TO THE SAID AMOUNT ONLY STA NDS AS ON DATE. THUS, THE PENALTY RELATABLE TO THE ADDITION OF RS. 32,06,090/ - STANDS DELETED. ON THIS ASPECT, REVENUE IS AGGRIEVED AND IS IN APPEAL BEFORE US. 3. AS PER THE ABOVE FACTS, IT IS EVIDENT THAT THE QUANTUM ADDITION IS DELETED AND THERE IS NO PENALTY LEVIABLE ON THE CORRESPONDING INCOME. IN THAT VIEW OF THE MATTER, WE ARE OF THE OPINION, THE GROUNDS RAISED BY THE REVENUE ARE NOT SUSTAINABLE AS THE CORRESPONDING ADDITION WAS DELETED BY THE TRIBUNAL. THESE FACTS ARE ALREADY DISCUSSED IN PARA 2.3 ONWARDS OF CIT (A). CONSIDERING THE ABOVE, WE ARE OF THE OPINION, THE DECISION TAKEN BY THE CIT (A) IS FAIR AND REASONABLE AND IT DOES NOT CALL FOR ANY INTERFERENCE. ACCORDINGLY, THE GROUNDS RAISED BY THE REVENUE ARE DISMISSED. 4. IN THE RESULT, APP EAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNC ED IN THE OPEN COURT ON 0 3 R D NOVEMBER, 2016. S D / - S D / - ( RAM LAL NEGI ) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; 03.11.2016 . . ./ OKK , SR. PS / 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 . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI