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2008 (3) TMI 374 - AT - Income TaxValidity of Reopening of assessment u/s 147 - Deemed dividend - addition u/s 2(22)(e) - change of opinion - whether information received from the Deputy Commissioner of Income Tax, Company Circle V(1) constituted new information?. Validity of Reopening of assessment u/s 147 - HELD THAT:- We find that for the AY 1999-2000, the original assessment was processed under s. 143(1). Hon'ble apex Court in the case of Asstt. CIT vs. Rajesh Jhaveri Stock Brokers (P) Ltd. [2007 (5) TMI 197 - SUPREME COURT] held that an intimation under s. 143(1)(a) cannot be treated as an assessment order and hence reopening matter cannot be agitated on that account. Hence, the assessee's plea regarding reopening of assessment for the AY 1999-2000 is liable to be dismissed and the same is dismissed as such. addition made under Deemed dividend u/s 2(22), Advance given - After referring to the decision of the Hon'ble Supreme Court in the case of Smt.Tarulata Shyam Vs. CIT [1977 (4) TMI 3 - SUPREME COURT], It is clear that it is the amount that is advanced during the year that is to be considered as deemed dividend and not the balance outstanding at the end of the accounting period. Hence, in the background of aforesaid discussion and precedents, we do not find any infirmity in the order of the learned CIT(A) for the AY 1998-99 as no part of advance given has been treated as deemed dividend before this assessment year. Hence, we affirm the learned CIT(A)'s order for the AY 1998-99. As regards AY 1999-2000, we are not in agreement with the learned CIT(A) that deemed dividend for AY 1998-99 should not be adjusted from the balance of accumulated profits as on the close of AY 1998-99. Hon'ble apex Court's order in G. Narasimhan (Died) & Ors.[1998 (12) TMI 5 - SUPREME COURT] case is very clear on this point and we do not see any ambiguity in this regard. Hence, for AY 1999-2000, AO is directed to compute deemed dividend equal to the amount advanced during that year to the extent company had accumulated profits after adjustment of deemed dividend for AY 1998-99. In the result, assessee's appeal for AY1998-99 is dismissed and assessee's appeal for AY 1999-2000 is partly allowed.
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