DCIT 10(3), MUMBAI V. INDOCEM ELECTRONIC SYSTEMS P.LTD, NAVI MUMBAI

ITA 2740/MUM/2013

• Counselvise Citation: 274019914 RSA 2013
• Duration Of Justice: 2 year(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-04-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: I
• Next Hearing Date: 20-04-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 08-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SACHIDANAND DUBEDR
• Assessee Lawyers: ASHOK PURI
• Keywords: Deemed dividend

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES G, MUMBAI , . . , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NO.2740/MUM/2013 ASSESSMENT YEAR: 2009-10 DCIT-10(3), ROOM NO.451, 4 TH FLOOR, AAYAKAR BHAVAN, M.K.ROAD, MUMBAI-400020 / VS. M/S INDOCEM ELECTRONIC SYSTEMS PVT. LTD. 403/409, GREAT EASTERN SUMMIT, A PLOT NO.56, SECTOR, 15, CBD BELAPUR, NAVI MUMBAI-400072 ( / REVENUE) ( !'# /ASSESSEE) P.A. NO. AAACI3124N / REVENUE BY SHRI SACHIDANAND DUBE-DR !'# / ASSESSEE BY SHRI ASHOK PURI $ % & #' / DATE OF HEARING 20/04/2015 & #' / DATE OF ORDER: 01/05/2015 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DAT ED 23/01/2013 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI, DELETING THE ADDITION OF RS.1,40,00,000/- U/S 2(22) (E) OF THE M/S INDOCEM ELECTRONIC SYSTEMS PVT. LTD. 2 INCOME TAX ACT, 1961, (HEREINAFTER THE ACT) IGNORIN G THE FACT THAT SHARE HOLDERS OF THE LENDER AND LENDEE COMPANI ES WERE COMMON. 2. DURING HEARING OF THIS APPEAL, SHRI SACHIDANAND DUBEY, LD. DR, DEFENDED THE ADDITION MADE IN THE ASSESSMENT ORDER BY ADVANCING HIS ARGUMENTS IDENTIC AL TO THE GROUND RAISED. ON THE OTHER HAND, SHRI ASHOK P URI, LD. COUNSEL FOR THE ASSESSEE, DEFENDED THE CONCLUSION A RRIVED AT IN THE IMPUGNED ORDER. IT WAS CONTENDED THAT THE I MPUGNED ISSUE IS COVERED BY THE DECISION OF THE TRIBUNAL IN ACIT VS BHAUMIK COLOR LAB PVT. LTD. (118 ITD 1) (MUM.) (SB) AND ALSO THE DECISION FROM HONBLE JURISDICTION HIGH CO URT IN CIT VS UNIVERSAL MEDICARE PVT. LTD. (2010) 324 ITR 263 (BOM.) 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT DURING ASSESSMENT PROCEEDING, THE ASSESSEE FOUND TO HAVE TAKEN LOAN FROM M/S ELCON MARINE SERVICES PVT. LTD. AMOUNTING TO RS.40 LAKH AND RS.100,00,000/- FROM M/ S GREVAL EXPORTS PVT. LTD. THE LD. ASSESSING OFFICER DEEMED THE LOANS AS DEEMED DIVIDEND WITHIN THE MEANING OF SECT ION 2(22)(E) OF THE ACT AND ADDED TO THE TOTAL INCOME O F THE ASSESSEE. 2.2. ON APPEAL, BEFORE THE LD. COMMISSIONER OF INC OME TAX (APPEALS), THE FACTS WERE EXAMINED AND FOUND TH AT THE ASSESSEE COMPANY WAS NOT THE SHARE HOLDER OF THE AF ORESAID COMPANIES FROM WHOM LOAN WAS TAKEN AND THUS DELETED THE M/S INDOCEM ELECTRONIC SYSTEMS PVT. LTD. 3 ADDITION BY FOLLOWING THE SPECIAL BENCH DECISION IN THE CASE OF BHAUMIK COLOR PVT. LTD. (SUPRA) AND THE DECISION FROM HONBLE BOMBAY HIGH COURT IN CIT VS UNIVERSAL MEDIC ARE PVT. LTD. (SUPRA). THE REVENUE IS AGGRIEVED AND IS IN APPEAL BEFORE THIS TRIBUNAL. 2.3. IF THE OBSERVATION MADE IN THE ASSESSMENT ORD ER, LEADING TO ADDITION MADE TO THE TOTAL INCOME, CONCL USION DRAWN IN THE IMPUGNED ORDER, MATERIAL AVAILABLE ON RECORD, ASSERTIONS MADE BY THE LD. RESPECTIVE COUNSEL, IF K EPT IN JUXTAPOSITION AND ANALYZED AND THE FACTUAL FINDING RECORDED IN THE IMPUGNED ORDER THAT THE ASSESSEE COMPANY IS NOT A SHARE HOLDER IN ANY OF THE COMPANIES WHO HAVE ADVAN CED LOANS TO THE ASSESSEE, THEREFORE, WE ARE IN AGREEME NT WITH THE CONCLUSION DRAWN IN THE IMPUGNED ORDER THAT THE CON DITION FOR INVOKING THE PROVISION OF SECTION 2(22)(E) OF T HE ACT IS NOT SATISFIED. RESPECTFULLY, FOLLOWING THE DECISION FRO M HONBLE JURISDICTIONAL HIGH COURT IN UNIVERSAL MEDICARE PVT . LTD. (SUPRA), WE AFFIRM THE STAND OF THE LD. COMMISSIONE R OF INCOME TAX (APPEALS). FINALLY, THE APPEAL OF THE REVENUE IS DISMISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVE OF BOTH SIDES, AT TH E CONCLUSION OF HEARING ON 20/04/2015. SD/- SD/- ( R.C.SHARMA ) (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER $ % MUMBAI; ) DATED : 01/05/2015 F{X~{T? P.S/. . . M/S INDOCEM ELECTRONIC SYSTEMS PVT. LTD. 4 %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. +,-. / THE APPELLANT 2. /0-. / THE RESPONDENT. 3. $ 1# ( +, ) / THE CIT, MUMBAI. P4. $ 1# / CIT(A)- , MUMBAI 5. 34 / # ! , +,' +!5 , $ % / DR, ITAT, MUMBAI 6. 6 7% / GUARD FILE. / BY ORDER, 03,# /# //TRUE COPY// / (DY./ASSTT. REGISTRAR) , $ % / ITAT, MUMBAI