TMI Blog2017 (12) TMI 810X X X X Extracts X X X X X X X X Extracts X X X X ..... rder. Accordingly, the provisions of Section 2(22)(e) were not attracted. We find nothing wrong in the order passed by the Tribunal on this aspect. Even otherwise the finding that the company was recipient company could not be held to be public limited company on the basis that the assessee had 38.31% shares cannot be accepted. The assessee of a limited company was entitled to hold shares of other corporate entities and holding of 38.31% shares of M/s. Dewas Soya Ltd will not by itself constitute reason enough to hold that the company is not a public limited company or the company in which public are not substantially interested in. The company M/s. Dewas Soya Ltd. and the assessee were apparently part of the same group. There is nothing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contention that by offering disallowance in respect of direct expenditure in relation to investment made for the earning of exempt income under Section 14A read with Section 8D(2)(i), then disallowance under Section 8D(2)(iii) cannot be made. The assessee has not challenged the order of the revenue. However, the revenue being aggrieved by the dismissal of the Revenue's appeal has proposed the following three questions as substantial questions of law : (i) Whether, on the facts and in circumstances of the case, the Tribunal was justified in holding that M/s.Dewas Soya Ltd is a public limited company as per the provision of Section 2(18) of the Income Tax Act, 1961 without appreciating the fact that the assessee is the beneficial ow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ddition by disallowing ₹ 32,17,444/- under Section 14A after reducing suo motu disallowance made by the assessee of ₹ 6,07,305/- and also observed that the assessee has defaulted in payment of ₹ 9,770/- towards employee's contribution under the Employees State Insurance Scheme (ESIC). Hence, that addition was made by the Assessing Officer. It was further observed that the assessee had obtained a loan from M/s. Dewas Soya Ltd. in which assessee held 38.31% shares. According to the Assessing Officer no evidence was submitted showing that the lending company was the one of which public was substantially interested as contemplated under the Act. The Assessing Officer also observed that no documentary evidence was submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ublic company. The Assessing Officer's observation to the effect that the assesse has procured funds from M/s.Dewas Soya Ltd in which the assessee had 38.31% shares was without basis and therefore, the amount of ₹ 1,00,00,000/- could not have been treated as deemed dividend under Section 2(22)(e) of the Act. The Tribunal did not find any infirmity with the order of CIT (A) which it found was a well reasoned order. Accordingly, the provisions of Section 2(22)(e) were not attracted. 5. We find nothing wrong in the order passed by the Tribunal on this aspect. Even otherwise the finding that the company was recipient company could not be held to be public limited company on the basis that the assessee had 38.31% shares cannot be ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive effect of the decision, the assessee would be entitled to benefit of the company. 7. In the present case, the Tribunal found that the assessee had deposited the contribution within the grace period and having done so, even assuming applicability of Section 43B, the requirement of law is deemed to have been complied. Furthermore, the payment having been made within grace period, the same was held to have been made within the period prescribed by law. On this ground also the order of the CIT (A) was upheld by the Tribunal. The order of the CIT (A) noted that the due date of the amount was 21st September, 2008 and the actual date of payment was 29th September, 2008. The CIT (A) also had found that the addition made by the Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ployees stood credited on or before the due date. This once again led to difficulties for the assessee. The Ministry of Finance, meanwhile, considering various representations inserted an amendment in the Finance Act, 2003 which came into effect from 1st April, 2004 deleting the second proviso to section 43B and further amending the first proviso. Provided that nothing contained in this section shall apply in relation to any sum which is actually paid by the assessee on or before the due date applicable in his case for furnishing the return of income under sub-section (1) of Section 139 in respect of the previous year in which the liability to pay such sum was incurred as aforesaid and the evidence of such payment is furnished by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
