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2022 (12) TMI 1319 - AT - Income TaxEstimation of income of the assessee at 10% of the administrative expenses and export expenses - HELD THAT:- As it is noticed that the issue is squarely covered in the group concern of the assessee being in the case of M/s. Serajuddin & Co. [2022 (10) TMI 1139 - ITAT CUTTACK] and in the case of Aliza International Pvt Ltd. [2022 (10) TMI 1141 - ITAT CUTTACK] respectfully following the decisions of the Co-ordinate Bench of this Tribunal the disallowance as confirmed by the ld CIT(A) at 10% stands reduced to 5%. Disallowance of auxiliary service addition - As it is noticed that this issue has already been considered in [2022 (10) TMI 1141 - ITAT CUTTACK]. and we have reduced the said disallowance made from 10% to 5%, Ground No.3 of the revenue stands dismissed. Direction of the ld CIT(A) in adopting the total income before depreciation - HELD THAT:- As it is noticed that the ld CIT(A) has reduced the total income assessed by the AO by considering the remand report as filed by the AO and as it is noticed that the said remand report has also been extracted by the ld CIT(A) in his order, we find no reason to interfere with the order of the ld CIT(A) on this issue. Ground Nos.4 & 5 of the revenue stand dismissed Deemed dividend addition u/s 2(22)(e) - HELD THAT:- A perusal of the provisions of section 2(22)(e) clearly shows that the word used is “on behalf, or for the individual benefit, of any such shareholder”. Thus, the deemed dividend, if at all, can be assessed is to be assessed in the hands of the shareholder on whose behalf or individual benefit, the loan has been given. In the present case, the assessee is not the shareholder of M/s. Aliza International Pvt Ltd., which would attract the provisions of section 2(22)(e) of the Act. In these circumstances, we are of the view that the findings of the ld CIT(A) is on right footing and does not call for any interference. Ground No.6 of the revenue stands dismissed. Addition of other income - As submitted CIT(A) did not add the same on the ground that the net profit as shown by the assessee was inclusive of the said amount of other income - HELD THAT:- As it is noticed that the ld CIT(A) has taken into consideration the fact that the said other income has already been considered while determining the net profit as per the accounts which are audited u/s.44AB, we are of the view that no addition of the said amount is called for. Consequently, Ground No.7 of the revenue stands dismissed. Disallowance of peripheral development expenses and maintenance expenses - HELD THAT:- Respectfully following the decision of the Co-ordinate Bench in the case of Aliza International Pvt Ltd. [2022 (10) TMI 1141 - ITAT CUTTACK] the addition as made by the AO and confirmed by the ld CIT(A) in respect of peripheral development expenses and maintenance expenses stands deleted. Penalty levied u/s.271(1)(c) - As submitted by ld AR that the search in the case of the assessee took place on 28.5.2008 and the assessment year 2009-10 was the specified period and for the purpose of levying the penalty, if at all, was u/s.271AAA and not u/s.271(1)(c) - HELD THAT:- The penalty leviable u/s.271AAA is 10% of the concealed income whereas under section 271(1)(c), the penalty is leviable at 100% of the tax sought to be evaded. A perusal of the order of the Assessing officer shows that the AO has levied penalty at 100% of tax sought to be evaded. Consequently, the order passed by the AO cannot be held as typographical error. In regard to levy of penalty u/s.271AAA assessment year 2009-10 is the specified year in respect of the assessee, as the search took place on 28.5.2008. Respectfully following the decision of the Co-ordinate bench of this Tribunal in the case of S.M.Enterprises [2022 (11) TMI 275 - ITAT CUTTACK] penalty levied u/s.271(1)(c) by the AO and confirmed by the CIT(A) stands deleted.
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