TMI Blog2018 (3) TMI 663X X X X Extracts X X X X X X X X Extracts X X X X ..... d as deemed dividend u/s 2 (22)(e). However, as per the decided case laws, the entries made in the regular books of accounts should not be considered in search assessments unless the assessment is incomplete. It is not permissible to revise the assessment order in the case of search assessments without referring to incriminating material in the case of completed assessments. Accordingly, we set aside the order of the Principal Commissioner of Income Tax and allow the appeals of the assessee. - I.T.A.No.273/Vizag/2017 And I.T.A.No.274/Vizag/2017 - - - Dated:- 9-3-2018 - SHRI V. DURGA RAO, JUDICIAL MEMBER AND SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER For The Appellant : Shri G.V.N. Hari, AR For The Respondent : Shri Deba Kumar So ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment year 2007-08, the company has advanced amounts of ₹ 5,31,700/- and the accumulated profits of the company was ₹ 2,94,081/- as on 31.3.2006. The Principal Commissioner of Income Tax was of the view that the advance received by the assessee company comes under the purview of deemed dividend as defined u/s 2(22)(e) of the Act as the assessee is holding more than 10% of voting power. It was also observed by the Principal Commissioner of Income Tax that the Director Mr. A. Nagesh holds 34% of shares and had received advance of ₹ 1,76,344/-, which also comes within the purview of deemed dividend u/s 2(22)(e) of the Act. Both the Directors have not shown the advances received from the company as a deemed dividend in the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income Tax. 5. We have heard both the parties, perused the materials available on record and gone through the orders of the authorities below. In this case, the search assessments were completed u/s 143(3) r.w.s. 153A of the Act by an order dated 31.3.2005 accepting the income returned. The Commissioner of Income Tax has taken up the case for revision u/s 263 of the Act with regard to the advances given by the company to the Directors who are holding substantial share in the companies. The company was having sufficient resources and the issue has to be considered as deemed dividend u/s 2 (22)(e) of the Act. However, as per the decided case laws, the entries made in the regular books of accounts should not be considered in search assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Section only on the basis of seized material'. In clause (v), the same is reiterated by ho/ding In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made In clause (vii), it is stated Completed assessments can be interfered with by the AO while making the assessment under Section 153A only on the bask of some incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be reiterated and the abated assessment or reassessment can be made In clause (vii), it is stated Completed assessments can be Interfered with by the AO while making the assessment under Section 153A only on the basis of some incrim ..... X X X X Extracts X X X X X X X X Extracts X X X X
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