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ACIT-3 (1) , Indore Versus Om Prakash Suri

ITA No.338 /Ind/2012 - Dated:- 28-8-2012 - SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER. Appellant by : Shri R.A. Verma, Sr. DR Respondent by : Shri Tribhuvan Sachdeva ORDER PER JOGINDER SINGH The Revenue is aggrieved by the impugned order dated 6.3.2012 passed by the learned CIT(A), Indore on the ground that on the facts and in the circumstances of the case, the first appellate authority erred in deleting the addition on account of deemed dividend by relying upon .....

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vour of the assessee by the decision of the Tribunal, that too, in own case of the assessee for AY 2005-06. This factual matrix was not controverted by the Revenue. 3. We have considered the rival submissions and perused the material available on record. In view of the above assertion, we are reproducing hereunder the relevant portion of the order of the Tribunal dated 3.1.2012: "5. The next ground pertains to confirming the addition of ₹ 85,488/-, considered as deemed dividend u/s 2( .....

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rticulars Debit Amount Credit Amount 01/04/04 By op. Bal 8,798,728 01/04/04 By cheque 600.000 08/04/04 By cheque 1,150,000 08/04/04 By cheque 1,550,000 02/06/04 By cheque 800.000 02/06/04 By cheque 1,900,000 02/07/04 By cheque 1,750,000 18.09.04 By cheques 1,00,000 05.10.04 By cheques 700,000 30.03.05 By cheques 410,000 On Assessing Officer's query to add the said amount u/s 2(22)(e) of the Act, the stand of the assessee was that the amount was not received as a loan but as an advance agains .....

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165/-. On appeal before the learned Commissioner of Income Tax (Appeals), the assessee contended that the amount was received as loans and advances. However, the learned Commissioner of Income Tax (Appeals) found that the accumulated profit of M/s Puzzling Equipref Services Private Limited was ₹ 57,676/- as on 31.3.2004 and ₹ 58,43,164/- as on 31.3.2005. Accordingly, he directed that the addition to the extent of ₹ 57,57,676/- is required to be made in the assessment year 2004- .....

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. As per the terms of the agreement, M/s Puzzling Equipref Services Private Limited was required to pay a part of the sale consideration in advance. The agreement to sell also witnessed payment of these amounts through account payee cheques to the assessee on various dates as mentioned at page 3 of the agreement to sell. Thus, we find that the amount so received by the assessee was against sale of land owned by him title of which is clear from the documents placed on record. Since the amount was .....

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inally, the appeal of the assessee is partly allowed. Order pronounced in the open Court on 3rd January, 2012." 4. We find that vide order dated 3.1.2012 (supra), the Tribunal decided two issues pertains to the assessee. The issue towards addition made u/s 68 of the Act was decided against the assessee and the issue of deemed dividend u/s 2(22)(e) of the Act was decided in favour of the assessee. The ld. CIT(A) for AY 2005-06 directed that the addition to the extent of ₹ 57,57,676/- w .....

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nt payee cheque to the assessee on various dates which were mentioned on the said sale agreement. Since the amount was received as a sale consideration in the normal course of the business, it was held that the same cannot be branded as loan and advances. This issue was decided in favour of the assessee. The ld. CIT(A), following the decision of the Tribunal, analysed the facts and deleted the addition which is under challenge before this Tribunal. 5. The Tribunal while deciding the identical fa .....

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ns and advances. In view of these facts, we are of the considered opinion that such transactions would not come under the provisions of sec. 2(22)(e) of the I.T. Act, 1961. The ratio laid down by Hon'ble Madras High Court in the case of CIT vs. F. Parveen (2008) 222 CTR (MAD) 639 wherein the Tribunal found that the amount was transferred by the company to its director in the normal course of business and not as a loan, the addition towards deemed dividend u/s 2(22)(e) of the Act was held to .....

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