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2016 (3) TMI 313 - ITAT MUMBAI

2016 (3) TMI 313 - ITAT MUMBAI - TMI - Deemed dividend u/s 2(22)(e) - Held that:- Respectfully following the decision of the co-ordinate bench of this Tribunal in the assessee’s own case for Asst. year 2010-11 wherein the ratio of the decision of the Hon’ble Bombay High Court in the case of Universal Medicare Pvt. Ltd. (2010 (3) TMI 323 - BOMBAY HIGH COURT ) was followed, we set aside the order of the Ld. CIT(A) on this issue and direct the AO to delete the addition of ₹ 26,21,073/- made i .....

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/2014 for Asst. year 2011-12. 2. The facts of the case, briefly, are as under:- 2.1 The assessee company engaged in dealing all kinds of fashion products etc. filed its return of income for Asst. year 2011-12 on 21/09/2011 declaring income of ₹ 6,53,43,040/-. The return was processed u/s 143(1) of the Income Tax Act, 1961 (in short the Act ) and the case was subsequently taken up for scrutiny. The assessment was concluded u/s 143(3) of the Act, vide order dt. 20/01/2014, wherein the income .....

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3. Being aggrieved with order of the CIT(Appeals)-17, Mumbai, the assessee has preferred this appeal before the Tribunal raising the following grounds:- 1. Against addition of ₹ 2,621,073/- as deemed dividend u/s 2(22)(e) of the Act The CIT(A) has erred in upholding the addition of ₹ 2,621,073/- made by the Assessing Officer ('AO') u/ s 2(22)(e) of the Act ignoring the facts of the case. The CIT (A) should have appreciated that out of the said amount, ₹ 2,621,073/- repr .....

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as deemed dividend u/s 2(22)(e) of the Act The CIT (A) has erred in upholding an addition of ₹ 50,000/- u/s 2(22)(e) of the Act made by the AO without considering the facts of the case. The CIT (A) should have appreciated that the said sum of ₹ 50,000/- represents mere repayment of expenses incurred by the appellant for and on behalf of Tainwala Trading and Investment Co. Pvt. Ltd (TTICPL) during the year under consideration. The CIT (A) failed to appreciate that since no loan or adv .....

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1 In this ground, the assessee contends that the Ld. CIT(A) erred in upholding the addition of ₹ 26,21,073/- made by the Assessing Officer ( AO ) u/s 2 (22)(e) of the Act. It was submitted that this amount of ₹ 26,21,073/- represents repayment of expenses incurred by the assessee for and on behalf of Tainwala Holdings Pvt. Ltd. It is submitted that the said amount was not a loan or advance received by the assessee and therefore the provisions of Section 2 (22)(e) of the Act would not .....

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f the Ld. CIT(A) on the impugned order. 4.3.1 We have heard both parties and perused and carefully considered the material on record; including the judicial decision cited. The addition, which is the subject matter of appeal, is ₹ 26,70,073/-, comprising of two limbs, namely an amount of ₹ 26,21,073/- purported to have been received by M/s. Tainwala Holdings and a sum of ₹ 50,000/- representing amount received from Tainwala Trading and Investment Co. Ltd. The former addition is .....

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he co-ordinate bench following the ratio of the decision of the Hon ble Bombay High Court in the case of CIT vs. Universal Medicare Pvt. Ltd., (324 ITR 263) (Bom) held that since the assessee is not a shareholder in the said concern, M/s. Tainwala Holdings Pvt. Ltd., such amount could not be assessed in the hands of the assessee. At paras 5 to 7 of its order the co-ordinate bench held as under:- 5. With respect to the addition of ₹ 28,74,875/-, considered as deemed dividend under section 2 .....

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