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2018 (8) TMI 51 - AT - Income TaxDeemed dividend addition u/s 2(22)(e) - proof of accumulated profits for the purpose of section 2(22)(e) - Held that:- CIT(A) has rightly observed that AO has wrongly made the addition u/s. 2(22)(e) by holding that there are accumulated profits in the hands of M/s Robin Software Pvt. Ltd. Ld. CIT(A) has also noticed that the AO has completed the assessment of M/s Robin Software Pvt. Ltd. for assessment year 2012-13 and no addition has been made in the hands of that company and return of loss has been accepted. CIT(A) has rightly cancelled the order of the AO by holding that if the AO has accepted the income returned by the said company and not made any changes in the return of income and assessed the income as declared by the said company, he cannot hold that there was accumulated profits for the purpose of section 2(22)(e) of the Act. when AO assesses the income of M/s Robin Software Pvt. Ltd. as loss for the same financial year, there could be no ground available to hold that the said company had accumulated profits at the time of making loans/advances. Therefore, the addition made as deemed dividend u/s. 2(22)(e) of ₹ 13,88,23,000/- was rightly deleted by the Ld. CIT(A) for want of fulfillment of the required conditions stipulated under the said section, which does not need any interference - decided against revenue
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