Ankitech Pvt. Ltd, New Delhi V. ACIT Range-I, New Delhi

ITA 2683/DEL/2008

• Counselvise Citation: [2009] 114 COUNSELVISE.COM (IT) 8283 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-06-2009
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 04-06-2009
• Assessment Year: 2005-2006
• Appeal Filed On: 13-08-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GEETMALA MOHANANEY
• Keywords: Deemed to accrue or arise in india; Deemed dividend
• Section: 2(22)(e); 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A NEW DELHI BEFORE SHRI G.E. VEERABHADRAPPA : VICE PRESIDENT; A ND SRI AAKASH DEEP JAIN : JUDICIAL MEMBER ITA NO. 2683/DEL/08 ASSTT. YRS: 2005-06 M/S ANKITECH PVT. LTD., VS. ACIT RANGE-1, 46, SHADHANAND MARG, NEW DELHI. DELHI-110006. PAN/GIR NO. AADCA1770B ( APPELLANT ) ( RESPONDENT ) APPELLANT BY : SHRI NIREN GUPTA CA RESPONDENT BY : MS. GEETMALA MOHANANEY CI T DR O R D E R PER G.E. VEERABHADRAPPA, V.P: THIS APPEAL, BY THE ASSESSEE, ARISES OUT OF THE ORD ER DATED 30-6-2008 OF THE CIT(A)-IV, NEW DELHI, FOR A.Y. 2005-06. 2. THE ASSESSEE IS A COMPANY, ENGAGED IN THE BUSINE SS OF MANUFACTURE AND SALE OF DIESEL GENERATOR SETS. THE MAIN DISPUTE IN THIS APPEAL RELATES TO THE ADDITION IN RESPECT OF DEEMED DIVIDEND U/S 2( 22)(E) OF THE ACT. IT WAS FOUND THAT THE ASSESSEE HAD MADE NUMBER OF TRANSACT IONS WITH SISTER CONCERN, NAMELY, JACKSONS GENERATORS P. LTD. AND JACKSON & C O. IT WAS FOUND FROM THE ANALYSIS OF THE ACCOUNTS OF THESE PARTIES THAT SUBSTANTIAL AMOUNT OF MONEY HAD GONE TO ITS SISTER CONCERNS. ACCORDING TO HIM, THE PAYMENTS MADE AND RECEIVED BY THE ASSESSEE COMPANY TO THESE CONCE RNS WERE HIT BY THE 2 PROVISIONS OF SECTION 2(22)(E) OF THE ACT. THE PAYM ENTS MADE BY THE SISTER CONCERN IS TREATED AS DEEMED INCOME IN THE HANDS OF THE ASSESSEE. 3. THE LEARNED COUNSEL FOR THE ASSESSEE, AT THE TIM E OF HEARING, POINTED OUT THAT THE ISSUE RAISED IN THIS APPEAL IS DIRECTL Y COVERED BY THE DECISION OF SPECIAL BENCH OF THE ITAT DATED 19-111-2008 IN ITA NO. 5030/MUM/04 FOR A.Y. 1997-98 IN THE CASE OF M/S BHAUMIK COLOUR PVT . LTD., A COPY OF WHICH IS ALSO PLACED ON RECORD. IT WAS ALSO SUBMITTED THA T IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2003-04 SIMILAR ISSUE AROSE AND THE ITAT DELHI BENCH C VIDE ORDER DATED 6-6-2008 IN ITA NO. 388/DEL/07 HAS DELETED THE ADDITION. THE LEARNED COUNSEL HAS ALSO GIVEN THE LIST OF SH ARE HOLDINGS OF ANKITECH PVT. LTD. AS ALSO THE SHAREHOLDING OF JAKSON GENERA TORS PVT. LTD. IN THE LIGHT OF THE SPECIAL BENCH DECISION OF THE ITAT (SUPRA), THE SUMS IN QUESTION CANNOT BE BROUGHT TO TAX U/S 2(22)(E) OF THE ACT. FACED WITH THIS THE LEARNED DR FAIRLY ADMITTED THAT THE ISSUE RAISED IN THIS AP PEAL IS IDENTICAL TO ONE BEFORE THE SPECIAL BENCH. IN THE LIGHT OF THE SAME, THE ADDITION MADE STANDS DELETED. 4. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 4-6-2009. SD/- SD/- ( AAKASH DEEP JAIN ) ( G.E. VEERABHADRAPPA ) JUDICIAL MEMBER VICE PRESIDENT DATED: 4-06-2009. MP COPY TO : 1. ASSESSEE 2. AO 3. CIT 4. CIT(A) 5. DR 3