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2022 (7) TMI 1142 - AT - Income TaxDeemed dividend addition u/s 2(22)(e) - undisclosed income admitted by the assessee in search proceedings has been considered the financial statements of VEIL and included as part of reserves and surplus of the company - DR contended that the company had sufficient accumulated profits and therefore the provisions of section 2(22)(e) of the Act are attracted - HELD THAT:- As noted that the accumulated profits to the extent available in the books of account shall be considered for the purpose of determining the deemed dividend U/s. 2(22)(e) - The reliance placed by the Ld. AR in the case of Promod Kumar Dang [2005 (11) TMI 193 - ITAT DELHI-A] has been rightly distinguished by the Ld. CIT(A) and cannot be applied to the instant case. However, we also find that the assessee has included the undisclosed income in its books of account resulting an increase in the accumulated profits of the company. CIT(A) has rightly computed the accumulated profits for the purpose of section 2(22)(e) of the Act subject to verification of certain tax challans as detailed in para 5.7 and 5.8 of the CIT(A)‟s order. We also note that the Ld. AO has rightly considered the directions of the Ld. CIT(A) and passed the consequential order revising the order passed U/s. 143(3) r.w.s 254 of the Act. In view of the above discussions, we find that there is no infirmity in the order of the Ld. CIT(A) as well as the Ld. AO while passing the consequential order. This ground of the assessee is therefore dismissed. Additional grounds of appeal regarding reopening of the case u/s. 148 - We find from the record that the Ld. AO has rightly given the reasons for such reopening and reopening is well within the period as prescribed under the Act. Therefore, this ground raised by the assessee is dismissed.
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