VIVEK DATTATRAY SAMANT, ANDHERI V. ASST. CIT 11 (3)(2), MUMBAI

ITA 6500/MUM/2019

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 8896 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-01-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2011-2012
• Appeal Filed On: 14-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: N R AGRAWAL
• Keywords: Deemed dividend; Set aside
• Section: 143(3); 2(22)(e); 147; 12

Judgement Text

IN THE INC OME TAX APPELLATE TRIBUNAL F BENCH, MUMBAI BEFORE SHRI VIKAS AWASTHY , JM & SHRI S. RIFAUR RAHMAN, AM ./ I.T.A. NO . 6500/MUM/2019 ( / ASSESSMENT YEAR: 2011 - 12) MR. VIVEK DATTATRAY SAMANT, 405, RAHEJA CREST BLDG. 1 OFF LI NK ORAD, OSHIWARA, ANDHERI (W), MUMBAI 400 053 / VS. ACIT 11(3)(3), AAYAKAR BHAVAN, MUMBAI - 400 020 ./ ./ PAN NO. AAZPS4623G ( / APPELLANT ) : ( / RESPONDENT ) & ./ I.T.A. NO . 6499/MUM/2019 ( / ASSESSMENT YEAR: 2011 - 12 ) MR S. NAMITA VIVEK SAMANT, 405, RAHEJA CREST BLDG. 1 OFF LINK ORAD, OSHIWARA, ANDHERI (W), MUMBAI 400 053 / VS. ITO WARD 11(3)(3), AAYAKAR BHAVAN, MUMBAI - 400 020 ./ ./ PAN NO. A A ZPS4624B ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI N. R. AGRAWAL, AR / RESPONDENTBY : MS. USHA GAIKWAD, DR / DATE OF HEARING : 19.11 .2020 / DATE OF PRONOUNCEMENT : 06.01.2021 2 I.T.A. NO 6499 & 6500 /MUM/2019 MRS. NAMITA VIVEK SAMANT & MR. VIVEK DATTATRAY SAMANT / O R D E R PER S. RIFAUR RAHMAN, ACCOUNTANT MEMBER : THE PRESENT TWO A PPEAL S HAVE BEEN FILED BY THE DIFFERENT ASSESSEE AGAINST THE ORDER OF LD. COMMIS S IONER OF INCOME TAX (APPEALS ) 18 IN SHORT REFERRED AS LD. CIT (A) , MUMBAI, DATED 28.08.2019 FOR A SSESSMENT YE AR (IN SHORT A Y ) 2011 - 12 RES PECTIVELY . 2. SINCE THE ISSUES RAISED IN BOTH THE APPEALS ARE IDENTICAL, THEREFORE, FOR THE SAKE OF CONVENIENCE, THESE APPEALS ARE CLUBBED, HEARD AND DISPOSED OF F BY THIS CONSOLIDATED ORDER. FIR STLY, WE ARE TAKING ITA NO. 6500 /M UM/2019 FOR ASSESSMENT YEAR 2011 - 12. 3. THE BRIEF FACTS OF THE CASE ARE , THE ASSESSEE I.E. SHRI V IVEK DATTATRAY SAMANT AND SMT. NAMITA VIVEK SAMANT ARE THE MAIN SHAREHOLDERS IN THE FOLLOWING COMPANIES AS DETAIL BELOW: - SR . N O. NAME OF THE CONCERN % SHAREH OLDING OF SHRI VIVEK D. SAMANT % SHAREHOLDING OF NAMITA V. SAMANT ACCUMULATED PROFITS AS ON 31.03.2010 1. YASHAM BIO SCIENCE 40% 20% 2. YASHAM CEMPHAR PVT. LTD. 84% 16% RS.1,25,65,608 3. YASHAM IMPORTERS & EXPORTERS PVT. LTD. 55.71% 18.75% RS. 2,61,39, 865 3 I.T.A. NO 6499 & 6500 /MUM/2019 MRS. NAMITA VIVEK SAMANT & MR. VIVEK DATTATRAY SAMANT 4. IN THE CASE OF YASHM BIO SCIENCE, AO OBSERVED THAT THE COMPANY YASHAM BIO SCIENCE PVT. LTD. RECEIVED AMOUNTS BY WAY OF UNSECURED LOANS FROM YASHAM CEMPHAR PVT. LTD. AND YASHAM IMPORTERS & EXPORTERS PVT. LTD. CONSIDERING THE FACT THAT SHRI V IVEK DAT TATRAY SAMANT AND SMT. NAMITA VIVEK SAMANT ARE MAIN SHAREHOLDERS, AO OBSERVED THAT BOTH THESE COMPANIES UNDER COMMON MANAGEMENT HAVE ACCUMULATED PROFIT S IN THEIR RESPECTIVE BALANCE SHEET. THEREFORE, HE CAME TO THE CONCLUSION THAT PROVISION OF SECTION 2(22) (E) OF THE ACT IS APPLICABLE IN THE CASE OF YASH AM BIO SCIENCE PVT. LTD, ACCORDIN GLY PROCEEDED TO MAKE ADDITIONS U/S 2(22(E) OF THE ACT. 5. ON APPEAL BEFORE LD. CIT(A), LD. CIT(A) SUSTAINED THE ADDITION ON SUBSTANTIVE BASIS IN THE CASE OF YASHAM BIO SCIEN CE PVT. LTD AND SUSTAINED THE ADDITION ON PROTECTIVE BASIS IN THE CASE OF THE SHAREHOLDERS (PRESENT ASSESSEES) 6. AGGRIEVED WITH THE ABOVE, ASSESSEE AND M/S YASHAM BIO SCIENCE PVT. LTD PREFERRED THE APPEAL BEFORE ITAT AND ITAT DELETED THE ADDITIONS MADE BY AO WITH THE FOLLOWING OBSERVATIONS: - 4 I.T.A. NO 6499 & 6500 /MUM/2019 MRS. NAMITA VIVEK SAMANT & MR. VIVEK DATTATRAY SAMANT 22. WE HAVE ALREADY ADJUDICATED IN ITA NO.2723/M/2017 IN THE CASE OF M/S. YASHAM BIO SCIENCES PVT. LTD. IN WHICH THE ADDITION WAS SUSTAINED AS SUBSTANTIVE ADDITION BY THE LD .CIT(A) THAT THE FINANCIAL TRANSACTIONS BETW EEN THE ASSESSEE AND TWO SISTER CONCERNS ARE NOT IN THE NATURE OF LOAN/ADVANCES AND THE ADDITION SUSTAINED UNDER SECTION 2(22)(E) OF THE ACT ON ACCOUNT OF DEEMED DIVIDEND WAS HELD TO BE WRONGLY SUSTAINED BY LD. CIT(A) AND DELETED. CONSEQUENTLY THE PROTECTI VE ADDITION AS SUSTAINED BY LD. CIT(A) IN THE CASE OF THE ASSESSEE DOES NOT SURVIVE AND THE AO IS DIRECTED TO DELETE THE SAME. 7. IT IS RELEVANT TO NOTICE THAT ITAT ORDER WAS PASSED ON 25.09.2020, WHEREAS RE - ASSESSMENT ORDER U/S 147 R.W.S 143(3) OF THE ACT WAS PASSED ON 29.11.2016 AND THE SAME WAS SUSTAINED BY LD. CIT(A) - 18, MUMBAI ON 28.08.2019. SINCE THE ITAT HAS PASSED THE ORDER SUBSEQUENTLY I.E. ON 25.09.2020, THE ORDER PASSED BY LD. C IT(A) BECOMES INFRUCTUOUS. CONSIDERING THE FACT THAT THE ADDITIONS SU STAINED BY LD. CIT(A) IS ONLY ON THE PROVISION OF SECTION 2(22)(E) AND THE COORDINATE BENCH OF THIS TRIBUNAL HAS ALREADY CONSIDERED THE FACTS AND GAVE DETAILED FINDINGS ON THIS ISSUE, THEREFORE WE ARE INCLINED TO ALLOW THE 5 I.T.A. NO 6499 & 6500 /MUM/2019 MRS. NAMITA VIVEK SAMANT & MR. VIVEK DATTATRAY SAMANT APPEAL FILED BY THE ASSESSEE I.E. SHAREHOLDERS OF YASHAM BIO SCIENCE PVT. LTD. ACCORDINGLY, THE ASSESSMENT ORDER PASSED U/S 147 R.W.S. 143(3) IS SET ASIDE AND GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED. 8 . SINCE THE OTHER APPEAL FILED BY THE ASSESSEE IN ITA NO. 6499 /MUM/2019 FOR ASSESSME NT YEAR 2011 - 12 IS SIMIL AR TO THE APPEAL IN ITA NO. 6500 /MUM/2019 FOR ASSESSMENT YEAR 2011 - 12, THEREFORE WE ALSO ALLOW THE GROUNDS RAISED BY THE ASSESSEE IN THIS APPEAL FOR THE PARITY OF REASONS. 9 . IN THE NET RESULT, THE APPEALS FILED BY THE RESPECTIVE ASS ESSEE S STANDS ALLOWED . ORDERS PRONOUNCED IN THE OPEN COURT ON 06.01.2021. SD/ - SD/ - (VIKAS AWASTHY ) (S. RIFAUR RAHMAN ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 06.01 .2020 SR.PS. DHANANJAY / COPY OF THE ORDER FORWARDED TO : 1. / THE ASSESSEE 2. / THE RESPONDE NT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 6 I.T.A. NO 6499 & 6500 /MUM/2019 MRS. NAMITA VIVEK SAMANT & MR. VIVEK DATTATRAY SAMANT 5. , , / DR, ITAT, MUMBAI 6. / GUARD F I LE / BY ORDER, . / (DY./ASSTT.REGISTRAR) , / ITAT, M UMBAI