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2017 (6) TMI 245 - AT - Income TaxDeemed dividend - Held that:- When the assessee’s premises and premises of PMPL are located in the same street, there is no requirement to hire lorry for carrying the goods. AR has invited my attention towards stock register of PMPL, a copy at page 42 of the paper book, which shows the corresponding receipt of goods from the assessee. It can be seen from the account of M/s PMPL in the assessee’s books for preceding and succeeding years, that similar type of trade transactions were carried out between the two entities in these years as well. Since the receipt of ₹ 18,10,000/- was on account of advance from the company, for which supply was made during the year itself, such receipts of advance cannot be construed as a dividend u/s 2(22)(e) of the Act. Therefore, order for the deletion of this addition. Enhancement u/s 2(22)(e) - Held that:- It is observed that the combined account was filed by the assessee with the ld. CIT(A) on 21.11.2016, which happens to be the last date of hearing as recorded on the titles of the impugned order. This shows that the ld. CIT(A) got the details and closed the hearing without making any further enquiries from the assessee about the nature of transactions. It was obligatory on his part to confront the assessee about his point of view and seek explanation before making any addition, which course of action has not been followed in the instant case. In my considered opinion, the ends of justice would meet adequately if the impugned order on this score is set aside and the matter is restored to the file of ld. CIT(A) for deciding this aspect of the matter afresh, after allowing an opportunity of hearing to the assessee.
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