TMI Blog2010 (2) TMI 824X X X X Extracts X X X X X X X X Extracts X X X X ..... are directed against the order CIT (A) dated 27.07.2009 for assessment year 2006-07. Grounds of appeal read as under:- ITA No. 3998/Del/2009 1. The Ld. CIT (Appeals) has erred in law and on facts of the case by not invoking the provisions of section 2 (22)(e) of the Income Tax Act, 1961 by treating the assessee firm M/s Shiva Commodities and Derivatives as 'not registered' shareholder of M/s Ram Commodities Trading Pvt. Ltd. whereas it has held 10000 shares of the company through its partner Shri Anuj Nagpal and also being beneficial owner of the shares of M/s Jai Sia Ram Commodities as is evident from the balance sheet of the assessee firm for the year in question. 2. The ld. CIT (Appeals) has erred in law by deleting the addit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e additional evidence filed u/r 46A. 2. The assessee is a partnership firm constituted by Shri Anuj Nagpal and Smt. Neelam Nagpal having 50% share each. Shri Anuj Nagpal and and Smt. Neelam Nagpal were having 10000 shares and 5000 shares respectively of M/s Jai Siya Ram Commodities Trading Pvt. Ltd. A sum of Rs.1 crore was advanced as loan to M/s Shiva Commodities and Derivatives which has been considered as deemed dividend in the hands of the assessee firm u/s 2(22) (e) of IT Act, 1961 read with Explanation 2. From the audit report it was noted by the AO that in the list of loans and deposits taken or accepted and repaid as per Section 269- SS/269-T, the assessee had received a sum of Rs.2 crore from M/s Jai Siya Ram Commodities Tradin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he said amount is being taxed at dividend income that could not have been done in the hands of the firm and, for this purpose, reliance was placed on the decision in the case of Ankitech Pvt. Ltd. vs. JCIT, order dated 6.6.2008 in ITA No.388 (ITAT, Delhi). 5. Noting from the ledger account of M/s Jai Siya Ram Commodities Trading Pvt. Ltd in the books of the assessee, the AO observed that the assessee itself had advanced a sum of Rs.50 lac each on 17th January, 2006 and 20th January, 2006, but it was repaid to it on 3rd March, 2006. Further, a loan of Rs.1 crore was received by the assessee on 14th March, 2006. No transaction with the assessee for which the margin was allegedly paid either during the previous year or even subsequent to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2008. b) ITO vs. Ajanta Cycles Pvt. Ltd. 99 TTJ 1159 c) CIT vs. Raj Kumar Singh and Co. 295 ITR 9. 8. The calculation made by the AO in respect of accumulated profit also was agitated. 9. The assessee also submitted an application for admission of additional evidence to submit copy of agreement of the assessee with M/s Jai Siya Ram Commodities Trading Pvt. Ltd. The said additional evidence was referred to the AO by CIT (A) who submitted his report vide letter dated 10th July, 2009. The AO agitated the admission of additional evidence on the ground that assessee could not fulfill the conditions laid down in Rule 46A. The CIT (A) has though rejected the admission of additional evidence, but accepted the claim of the assessee o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d dividend. 12. We have carefully considered the submission of Ld. DR and also carefully gone through the order of AO and CIT (A). The assessee in whose hand the said dividend has been assessed is a firm consisting of abovementioned two partners who were having the share of M/s Jai Siya Ram Commodities Trading Pvt. Ltd. The Special Bench in the case of CIT vs. Bhaumic Colours (P) Ltd.(supra) has held that deemed dividend could be assessed only in the hands of a person who is a shareholder of the lender company and not in the hands of a person other than the shareholder. It is also held that the expression'shareholder' referred to in Section 2 (22)(e) refers to both a registered shareholder and a beneficial shareholder. If a person is a ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
