Appeal Details
Counselvise Citation
[2017] 126 COUNSELVISE.COM (IT) 9837 (ITAT-MUMBAI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
8 month(s) 18 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
23-08-2017
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
SMC
Assessment Year
2010-2011
Appeal Filed On
05-12-2016
Judgement Text
THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI B.R. BASKARAN (AM) I.T.A. NO. 7097 /MUM/ 2 016 (ASSESSMENT YEAR 20 10 - 11 ) ACIT 18(1) ROOM NO. 202 2 ND FLOOR EARNEST HOUSE NARIMAN POINT MUMBAI - 400 021. VS. M/S. GBC PACKAGING 18, FIDA BUIL DING 1 ST FLOR SHAMALDAS GANDHI MARG MUMBAI - 400 002. ( APPELLANT ) ( RESPONDENT ) PAN NO . AAHFG1694D ASSESSEE BY SHRI NEEL KHANDELWAL DEPARTMENT BY MS. N. HEMALATHA DATE OF HEARING 2 3 . 8 . 201 7 DATE OF PRONOUNCEMENT 23 . 8 . 201 7 O R D E R THE RE VENUE HAS FILED THIS APPEAL CHALLENGING THE ORDER DATED 26 - 09 - 2016 PASSED BY LD CIT(A) - 29, MUMBAI AND IT RELATES TO THE ASSESSMENT YEAR 2010 - 11. THE REVENUE IS AGGRIEVED BY THE DECISION OF LD CIT(A) IN DELETING THE ADDITION OF RS.50.07 LAKHS RELATING TO D EEMED DIVIDEND. 2. THE FACTS RELATING TO THE ISSUE ARE DISCUSSED IN BRIEF. THE ASSESSEE IS A PARTNERSHIP FIRM AND IT RECEIVED A LOAN OF RS.125.18 LAKHS FROM A CLOSELY HELD COMPANY NAMED M/S GOPALDAS VISRAM & CO DURING THE YEAR UNDER CONSIDERATION. T HE ABOVE SAID COMPANY HAD HELD ACCUMULATED PROFITS OF RS.50,07,164/ - . THE ABOVE SAID INFORMATION WAS PASSED ON TO THE ASSESSING OFFICER OF THE ASSESSEE. HENCE THE AO REOPENED THE ASSESSMENT IN ORDER TO ASSESS THE AMOUNT OF RS.50,07,164/ - AS DEEMED DIVIDE ND U/S 2(22)(E) OF THE ACT IN THE HANDS OF THE ASSESSEE. THE ASSESSEE SUBMITTED THAT IT IS NOT THE SHAREHOLDER IN THE ABOVE SAID COMPANY AND ITS PARTNERS ONLY, IN THEIR INDIVIDUAL CAPACITY, ARE THE SHAREHOLDERS. ACCORDINGLY IT WAS CONTENDED THAT THE PROV ISIONS OF SEC. 2(22)(E) CANNOT BE APPLIED IN THE HANDS OF THE ASSESSEE. M/S. GBC PACKAGING 2 THE AO DID NOT AGREE WITH THE CONTENTIONS OF THE ASSESSEE AND ACCORDINGLY HE ASSESSED THE ABOVE SAID AS DEEMED DIVIDEND IN THE HANDS OF THE ASSESSEE. THE LD CIT(A) REVERSED THE SAME AND HENCE THE REVENUE HAS FILED THIS APPEAL BEFORE THE TRIBUNAL. 3. I HEARD THE PARTIES AND PERUSED THE RECORD. I NOTICE THAT THE LD CIT(A) HAS REVERSED THE DECISION OF ASSESSING OFFICER WITH THE FOLLOWING OBSERVATIONS: - 5.1 THE APPELLANT - FIRM HAS T AKEN A LOAN OF ` 50,07,164/ - AS VISRAM & CO LTD., WHICH IS A COMPANY IN WHICH PUBLIC IS NOT SUBSTANTIALLY INTERESTED. THE PARTNERS OF THE APPELLANT FIRM ARE HOLDING NOT LESS THAN 10% VOTING POWER IN M/S. GOPALDAS VISRAM & CO LTD. 5.2. SECTION 2(22)(E) IS REPRODUCED HERE UNDER : - SEC. 2(22)(E) AN Y PAYMENT BY A COMPANY, NOT BEING - 'A COMPANY IN WHICH THE PUBLIC ARE SUBSTANTIALLY INTERESTED, OF ANY SUM ( WHETHER AS REPRESENTING A PART OF THE ASSETS OF THE COMPANY OR OTHERWISE) MADE AFTER THE 31ST DAY OF MAY, 1987 BY WAY OF ADVANCE OR LOAN TO A SHAREHOLDER, BEING A PERSON WHO IS THE BENEFICIAL OWNER OF SHARES (NOT BEING SHARES ENTITLED TO A FIXED RATE OF DIVIDEND WHETHER W ITH OR WITHOUT A RIGHT TO PARTICIPATE IN PROFITS) HOLDING NOT LESS THAN TEN PER CENT OF TH E VOTING POWER, OR TO ANY CONCERN IN WHICH SUCH SHAREHOLDER IS A MEMBER OR A PARTNER AND IN WHICH HE HAS A SUBSTANTIAL INTEREST (HEREAFTER IN THIS CLAUSE REFERRED TO AS THE SAID CONCERN , ) OR ANY PAYMENT BY ANY SUCH COMPANY ON BEHALF, OR FOR THE INDIVIDUA L BENEFIT, OF ANY SUCH SHAREHOLDER, TO THE EXT ENT TO WHICH THE COMPANY IN EITHER CASE POSSESSES ACCUMULATED PROFITS; SHARE IS NOT ENTITLED IN THE EVENT OF LIQUIDATION TO PARTICIPATE IN THE SURPLUS ASSETS ; (IA) A DISTRIBUTION MADE IN ACCORDANCE WITH SUB - CLAUSE (C) OR SUB - CLAUSE (D) IN SO FAR AS SUCH DISTRIBUTION IS ATTRIBUTABLE TO THE CAPITALISED PROFITS OF THE COMPANY REPRESENTING BONUS SHARES ALLOTTED TO ITS EQUITY SHAREHOLDERS AFTER THE 31ST DAY OF MARCH; 1964, AND BEFORE THE 1ST DAY OF APRIL, 1965; ( II) ANY ADVANCE OR LOAN MADE TO A SHAREHOLDER OR THE SAID CONCERN BY A COMPANY IN THE ORDINARY COURSE OF ITS BUSINESS, WHERE THE LENDING OF MONEY IS A SUBSTANTIAL PART OF THE BUSINESS OF THE COMPANY ; M/S. GBC PACKAGING 3 III) ANY DIVIDEND PAID BY A COMPANY WHICH IS SET OFF B Y THE COMPANY AGAINST THE WHOLE OR ANY PART OF ANY SUM PREVIOUSLY PAID BY IT AND TREATED AS A DIVIDEND WITHIN THE MEANING OF SUB - CLAUSE (E), TO THE EXTENT TO WHICH IT IS SO SET OFF; (IV) ANY PAYMENT MADE BY A COMPANY ON PURCHASE OF ITS OWN SHARES FROM A SHAREH OLDER IN ACCORDANCE WITH THE PROVISIONS OF SECTION 77A OF THE COMPANIES ACT. 1956 (I OF 1956); (V) ANY DISTRIBUTION OF SHARES PURSUANT TO A DEMERGER BY THE RESULTING COMPANY TO THE SHAREHOLDERS OF THE DEMERGED COMPANY (WHETHER OR NOT THERE IS A REDUCTION OF C APITAL IN THE DEMERGED COMPANY).' 5.2.1. ACCORDING TO THE SECTION, ANY PAYMENT MADE BY THE COMPANY BY WAY OF ADVANCE OR LOAN TO A SHAREHOLDER, BEING THE PERSON WHO IS THE BENEFICIAL OWNER OF THE SHARES, HOLDING NOT LESS THAN 10% OF THE VOTING POWER, OR TO ANY CONCERN IN WHICH SUCH SHAREHOLDER IS A MEMBER OR A PARTNER IN WHICH HE HAS A S UBSTANTIAL INTEREST OR ANY PAYMENT WILL BE TREATED AS DEEMED DIVIDEND. 5.2.2. THE SECTION CLEARLY SHOWS THAT IF ANY LOAN OR ADVANCE IS GIVEN TO A CONCERN IN WHICH THE PER SON HAVING SUBSTANTIAL INTEREST IS A PARTNER, THEN THAT THE P AYMENT WOULD BE COVERED U/S.2(22)(E). HOWEVER, IT IS ONLY THE SHAREHOLDER WHO WILL BE PAID DIVIDEND AND DEEMED DIVIDEND WILL ALSO BE TAXED IN THE HANDS OF THE SHAREHOLDER ONLY. THE APPELLANT HAS RELIED ON THE DECISION OF IMPACT . CONTAINERS (P) LTD. VS. CIT 48 TAXMAN.COM 294(BOM.), WHERE THE HONBLE BOMBAY HIGH COURT HELD 'WHAT IS THUS INCLUDED IS THE PAYMENT MADE BY A COMPANY TO ITS SHAREHOLDER I.E. BY WAY OF ADVANCE OR LOAN TO HIM. THIS IS INCLUDE D SO AS TO VISIT A SHAREHOLDER WITH A LIABILITY TO PAY TAX. IT IS ENTIRELY THE SHAREHOLDER WHO WILL PAY THE TAX ON THE SAME. THE SHAREHOLDER CANNOT ESCAPE THAT LIABILITY MERELY BECAUSE THE LOAN OR ADVANCE HAS BEEN MADE TO ANY CONCERN IN WHICH THE SAID SHAR EHOLDER IS A MEMBER OR A PARTNER AND IN WHICH HE HAS SUBSTANTIAL INTEREST. 5.2.3 THE MUMBAI HIGH COURT RELIED UPON ITS OWN DECISION IN THE CASE OF M/S.UNIVERSAL MEDICARE PVT. LTD. 324 ITR 263(BORN) AND HELD AS UNDER : - THE REVENUE SUBMISSION IN THIS BEHALF CANNOT BE ACCEPTED. THE LEGISLATURE HAS INCORPORATED AND INSERTED THE DEFINITION M/S. GBC PACKAGING 4 OF THE TERM 'DIVIDEND'. IT IS MADE INCLUSIVE OF DISTRIBUTION OF PROFITS, ANY DISTRIBUTION TO THE SHAREHOLDERS BY A COMPANY OF DEBENTURES, DEBENTURE - STOCK, OR DEPOSIT CE RTIFICATE IN ANY FORM, OR DISTRIBUTION MADE TO THE SHAREHOLDERS UPON LIQUIDATION OF A COMPANY. EQUALLY, AMOUNT DISTRIBUTED ON REDUCTION OF CAPITAL IS TERMED AS DIVIDEND. WHAT IS ALSO THEN INCLUDED IS A PAYMENT MADE BY A COMPANY TO ITS SHAREHOLDER. THAT IS BY WAY OF ADVANCE OR LOAN TO HIM. THIS IS INCLUDED SO AS TO VISIT THE SHAREHOLDER WITH A LIABILITY TO PAY TAX. IT IS EVENTUALLY, THE SHAREHOLDER WHO WILL PAY TAX ON THE SAME. THE SHAREHOLDER CANNOT ESCAPE THAT LIABILITY MERELY BECAUSE THE LOAN OR ADVANCE H AS BEEN MADE OVER TO ANY CONCERN IN WHICH SUCH SHAREHOLDER IS A MEMBER OR A PARTNER AND IN WHICH HE HAS SUBSTANTIAL INTEREST. EARLIER, LEGISLATURE NOTED THAT THE SHAREHOLDER WOULD RECEIVE THE SUM FROM A COMPANY AND WHICH IS NOT STRICTLY FALLING WITHIN THE CONCEPT OF 'DIVIDEND'. FIRSTLY, BECAUSE THAT WAS RECEIVED BY WAY OF ADVANCE OR LOAN, SECONDLY, AN ATTEMPT WAS MADE TO SHOW THAT THE ADVANCE OR LOAN IS NOT TO THE SHAREHOLDER WHO IS REGISTERED AS SUCH BUT TO A CONCERN IN WHICH HE IS A MEMBER . OR A PARTNER A ND IN WHICH HE MAY HAVE A SUBSTANTIAL INTEREST BUT THAT CANNOT BE TERMED AS ADVANCE OR LOAN TO THE SHAREHOLDER. WITH A VIEW TO TAKE CARE OF SUCH STAND OF THE SHAREHOLDERS AND NOT ALLOW THEM TO ESCAPE THE LIABILITY TO PAY TAX THAT THE DEFINITION CAME TO BE BROADLY WORDED BY INDICATING THEREIN THE REFERENCE TO ANY CONCERN. EQUALLY, ANY PAYMENT MADE BY SUCH COMPANY ON BEHALF OF THE SHAREHOLDER OR FOR INDIVIDUAL BENEFIT OF ANY SHAREHOLDER TO THE EXTENT TO WHICH THE COMPANY IN OTHER CASE POSSESSES ACCUMULATED PR OFITS HAS ALSO BEEN BROUGHT IN. THUS, IN ADDITION TO DISTRIBUTION OF ACCUMULATED PROFIT, DEBENTURE STOCK OR DEPOSIT CERTIFICATE ETC, A PAYMENT OF THE AFORESAID NATURE HAS BEEN TERMED AS 'DIVIDEND' AND INCLUDED IN THE DEFINITION. AT THE SAME TIME, THE LEGIS LATURE HAS TAKEN CARE NOT TO INCLUDE ANY ADVANCE OR LOAN MADE TO SHAREHOLDER OR THE SAID CONCERN IN WHICH SUCH SHAREHOLDER IS A MEMBER OR A PARTNER AND IN WHICH HE HAS SUBSTANTIAL INTEREST IN THE ORDINARY COURSE OF THE BUSINESS OF THE COMPANY AND WHERE LE NDING OF MONEY IS SUBSTANTIAL PART OF THE BUSINESS OF THE COMPANY. EQUALLY, ANY DIVIDEND PAID BY THE COMPANY WHICH IS SET OFF BY THE COMPANY AGAINST THE WHOLE OR ANY PART OF ANY SUM PREVIOUSLY PAID BY IT AND TREATED AS A DIVIDEND WITHIN THE MEANING OF SUB - CLAUSE (E) , TO THE EXTENT TO WHICH IT IS SO SET OFF, IS ALSO EXCLUDED ADVISEDLY. [PARA 28] ONE CANNOT SEE HOW WITH THIS LEGAL POSITION AND THE STATUS M/S. GBC PACKAGING 5 OF THE SHAREHOLDER RECOGNIZED IN LAW CAN BE IGNORED WHILE INTERPRETING SECTION 2 (22) (E) OF THE I. T. ACT. PR ECISELY, THIS IS WHAT HAS BEEN DONE BY THIS COURT IN THE JUDGMENT RENDERED IN THE CASE OF UNIVERSAL MEDICARE (P) LTD (SUPRA). THE VIEW TAKEN BY THIS COURT IN THE CASE OF UNIVERSAL MEDICARE (P) LTD (SUPRA) DOES NOT REQUIRE ANY RECONSIDERATION. THE RE VENUE'S CONTENTION THAT THE DEFINITION DOES NOT CONTEMPLATE OR DOES NOT STIPULATE ANY REQUIREMENT OF ASSESSEE BEING A SHAREHOLDER OF THE ASSESSEE LIKE THE ONE IN THE PRESENT CASE CANNOT BE ACCEPTED. THE VIEW TAKEN IN THE PRESENT CASE THAT THE RECIPIENT/ASS ESSEE WAS NOT A SHAREHOLDER, THUS IS IN CONSONANCE WITH THE LEGAL POSITION NOTED HEREINABOVE. [PARA 30] THE DELHI HIGH COURT EVEN AFTER EXHAUSTIVE AMENDMENT TO SECTION 2(22)(E) HELD THAT THE PAYMENT MADE TO ANY CONCERN WOULD NOT COME WITHIN THE PURVIEW OF THIS SUB - CLAUSE SO LONG AS IT CONTEMPLATED SHAREHOLDERS. THE DIVISION BENCH OF DELHI HIGH COURT HAS MADE DETAILED REFERENCE TO ALL THE DECISIONS IN THE FIELD. IT HAS ALSO REFERRED TO THE ORDER PASSED BY THE SPECIAL BENCH OF THE TRIBUNAL IN ARRIVING AT THE SAME CONCLUSION. IN THE CIT V. ANKITECH (P) LTD [2012] 340 ITR 14/12011] 199 TAXMAN 341/11 TARMANN.COM 100 (DELHI), THE DELHI HIGH COURT REFERRED TO BOTH C. P. SARATHY MUDALIAR (SUPRA) AND RANIESHWARKIL SANWARMAL (SUPRA), EXTENSIVELY. IT ALSO REFERRED TO THE ARGUMENTS OF THE REVENUE WHICH ARE SOME WHAT SIMILAR TO THOSE RAISED HERE. IT IS IN DEALING WITH THESE ARGUMENTS THAT THE DIVISION BENCH CONCLUDED THAT ALL THE THREE LIMBS OF THE SECTION ANALYZED IN UNIVERSAL MEDICARE (P.) LTD. (SUPRA) DENOTE THE INTENTION THAT CLOSELY HELD COMPANIES NAMELY COMPANIES IN WHICH PUBLIC ARE NOT SUBSTANTIALLY INTERESTED WHICH ARE CONTROLLED BY A GROUP OF MEMBERS, EVEN THOUGH HAVING ACCUMULATED PROFITS WOULD NOT DISTRIBUTE SUCH PROFIT AS DIVI DEND BECAUSE IF SO DISTRIBUTED THE DIVIDEND INCOME WOULD BECOME TAXABLE IN THE HANDS OF THE SHAREHOLDERS. INSTEAD OF DISTRIBUTING ACCUMULATED PROFITS AS DIVIDEND, COMPANIES DISTRIBUTE THEM AS LOAN OR ADVANCES TO SHAREHOLDERS OR TO CONCERN IN WHICH SUCH SHA REHOLDERS HAVE SUBSTANTIAL INTEREST OR MAKE ANY PAYMENT ON BEHALF OF OR FOR THE INDIVIDUAL BENEFIT OF SUCH SHAREHOLDER. IN SUCH AN EVENT, BY THE DEEMING PROVISION, SUCH PAYMENT BY THE COMPANY IS TREATED AS DIVIDEND. THE PURPOSE IS TO TAX DIVIDEND IN THE HA NDS OF THE SHAREHOLDER. [PARA 32] ' 5.2.4. SIMILAR VIEW HAS BEEN TAKEN BY THE SPL. BENCH IN THE CASE OF ACIT VS. BHAUMIK C OLOUR PVT. LTD. 118 ITD 1 (BOM ) . M/S. GBC PACKAGING 6 5.2.5. THE AO HAS HEAVILY RELIED UPON THE JUDGEMENT OF M/S. NATIONAL TRAVEL SERVICES WHICH IS NOT A PPLICABLE TO THE PRESENT CASE. THE HON'BLE HIGH COURT OF BOMBAY HAS CATEGORICALLY STATED THAT DEEMED - DIVIDEND HO N'BE - ASSESSED ONLY IN THE HANDS OF A SHAREHOLDER IRRESPECTIVE OF THE STATUS OF THE SHAREHOLDER. SHE HAS MENTIONED THAT THE JUDGEMENT IN THE CASE OF IMPACT CONTAINERS PVT. LTD. HAS NOT BEEN ACCEPTED BY THE DEPARTMENT AND THEREFORE IT IS NOT BEEN FOLLOWED. HOWEVER, THE JUDGEMENT OF THE JURISDICTIONAL HIGH COURT IS BINDING ON ALL THE LOWER AUTHORITIES IN THE JURISDICTION. 5.2. 6. IN THE CASE OF HDF C BANK LTD. VS. DCIT 383 ITR 529 (BORN.), THE HON'BLE JURISDICTIONAL HIGH COURT OF BOMBAY HELD THAT' THE LAW DECLARED BY THE DECISION THE HIGH COURT WILL BE BINDING UPON ALL . AUTHORITIES AND TRIBUNALS WITHIN THE STATE. CONSEQUENTLY, THE DECISION OF THIS CO URT WOULD BE BINDING UPON ALL THE AUTHORITIES AND TRIBUNAL AND COURT SUBORDINATE TO THE HIGH COURT WITHIN THE STATE OF MAHARASHTRA. . ONCE THERE IS A BINDING DECISION OF THESE COURTS, THE SAME CONTINUES TO BE BINDING ON ALL AUTHORITIES WITHIN THE STATE TIL L SUCH TIME AS IT IS STAYED AND / OR SET ASIDE BY THE APEX COURT OR THIS VERY COURT TAKES A DIFFERENT VIEW ON AN IDENTICAL FACTUAL MATRIX OR A VIEW ALREADY TAKEN. THE DECISION WOULD BE CONSIDERED TO BE A BINDING PRECEDENT ONLY IF IT DOES DEALS WITH/ DECIDE S AN ISSUE WHICH IS SUBJECT MAT TER OF CONSIDERATION / DECISION BEFORE A COORDINATE OR SUBORDINATE COURT. IT IS AXIOMATIC THAT A DECISION CANNOT BE RELIED UPON IN SUPPORT OF THE PROPOSITION THAT IT DID NOT DECIDE. THEREFORE, IT IS ONLY THE RATIO DECIDENDI I. E. THE PRINCIPLE OF LAW THAT DECIDES THE DISPUTE WHICH CAN BE RELIED UPON AS PRECEDENT AND NOT ANY OBITER DICTUM OR CASUAL OBSERVATIONS.' 5.2.7. IN VIEW OF THE ABOVE AND RESPECTFULLY FOLLOWING THE JUDGEMENT OF THE SPL.BENCH OF HON'BLE MUMBAI ITAT IN THE C ASE OF BHAUMIK COLOUR PVT. LTD AND THAT OF THE HON'BLE HIGH COURT IN THE CASE OF IMPACT CONTAINERS PVT. LTD., 367 ITR 346, BOMBAY, THE ADDITION MADE BY THE AO IS DELETED. THIS GROUND OF APPEAL IS ALLOWED. 4. AT THE TIME OF HEARING , THE LD D.R HEAVILY PLA CED HER RELIANCE ON THE DECISION RENDERED BY HONBLE DELHI HIGH COURT IN THE CASE OF M/S PREMLATA BANSAL, NATIONAL TRAVEL SERVICES & OTHERS (ITA NO.223 OF 2010; 219 OF 2010; 1204 OF 2010 AND 309 OF 2011 DATED 11.7.2011)(249 CTR 540) AND SUBMITTED THE HONB LE DELHI HIGH COURT HAS HELD THAT THE PARTNERSHIP FIRM SHALL BE CONSIDERED AS SHAREHOLDER FOR THE PURPOSE OF SEC. 2(22)(E) OF THE ACT. M/S. GBC PACKAGING 7 SHE FURTHER SUBMITTED THAT THE HONBLE BOMBAY HIGH COURT HAS NOT CONSIDERED THE LEGAL POSITION OF PARTNERSHIP FIRM AND H ENCE THE DECISION RENDERED BY HONBLE DELHI HIGH COURT MAY BE PREFERRED. 5. I AM UNABLE TO AGREE WITH THE PLEA OF THE LD D.R. I NOTICE THAT THE LD CIT(A) HAS FOLLOWED THE BINDING DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF IMPACT CONTAINERS P LTD (SUPRA). I HAVE ALSO GONE THROUGH THE DECISION RENDERED BY HONBLE DELHI HIGH COURT IN THE CASE OF NATIONAL TRAVEL SERVICES. THE FACTS RELATING THAT CASE HAS BEEN DISCUSSED BY HONBLE DELHI HIGH COURT IN PARAGRAPH 7 OF ITS ORDER. A PERUSAL OF THE SA ME SHOWS THAT THE PARTNERSHIP FIRM, VIZ., M/S NATIONAL TRAVEL SERVICES ITSELF HAS INVESTED ITS FUNDS IN THE COMPANY THROUGH ITS PARTNER, I.E., THE PARTNER WAS HOLDING SHARES ON BEHALF OF THE PARTNERSHIP FIRM. UNDER THESE SET OF FACTS, THE HONBLE DELHI HI GH COURT HELD THAT THE PARTNERSHIP FIRM SHALL BE CONSIDERED AS SHAREHOLDER FOR THE PURPOSES OF SEC. 2(22)(E) OF THE ACT. 6. IN THE INSTANT CASE, THE PARTNER OF THE ASSESSEE FIRM HAS HELD THE SHARES IN THE CLOSELY HELD COMPANY IN HER INDIVIDUAL CAPACITY. HENCE, IN MY VIEW, THE DECISION RENDERED IN THE CASE OF NATIONAL TRAVEL SERVICES CANNOT BE TAKEN SUPPORT OF. SINCE THE LD CIT(A) HAS HELD THAT THE IMPUGNED AMOUNT CANNOT BE ASSESSED AS DEEMED INCOME OF THE ASSESSEE BY FOLLOWING THE BINDING DECISION REND ERED BY HONBLE BOMBAY HIGH COURT, I DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER PASSED BY LD CIT(A) ON THIS ISSUE. I ACCORDINGLY UPHOLD HIS ORDER. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 2 3 . 8 . 201 7. SD/ - (B.R.BASKARAN) ACCOUNTANT MEMBER MUMBAI ; DATED : 2 3 / 8 / 20 1 7 M/S. GBC PACKAGING 8 COPY OF THE ORDER FORWARDED TO : 1. THE AP PELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( DY./ASSTT. REGISTRAR) PS ITAT, MUMBAI
Mehul