TMI Blog2018 (5) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... nd hence, we quash the reassessment order - Decided in favour of assessee. - I.T.A. No. 7026/Del/2014 - - - Dated:- 26-4-2018 - SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER Assessee by : Sh. Rajesh Arora, CA Department by : Shri Ravi Kant Gupta, Sr. DR ORDER PER H.S. SIDHU, JM This appeal by the Assessee is directed against the Order dated 27.10.2014 of the Ld. CIT(A),(Central), Gurgaon pertaining to assessment year 2007-08 on the following grounds:- 1. The Ld. CIT(A) has erred in law and facts of the case in upholding its reopening u/s. 147 and further upholding the validity of notice u/s. 148 of the Income tax Act, 1961 which is beyond jurisdiction, void ab initio and needs to be quas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... licable in the case of the assessee. However, in this case there are two shareholders Sh. Aman Sharma and Sh. Vipin Sharma who are holding more than 20% share holding in both the companies. Hence, 50% of the loan of ₹ 36,00,000/- should be treated as deemed dividend in the hands of the assessee being a substantial shareholder Proceedings u/s. 147 of the Act were initiated and the case was reopened after obtaining approval from the Ld. Commissioner of Income Tax (Central), Gurgaon. Notice us. 148 of the Act was issued on 14.3.2013 which was duly served upon the assessee. In response thereto, the assessee stated that return filed on 14.5.2010 may be treated as having been filed in response to the aforesaid notice. Thereafter, a notice u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court has relied on the judgment of Hon ble Apex Court in the case of GKN Driveshafts vs ITO reported in 259 ITR 19. In view of above, he requested that re-assessment may be quashed. 4. On the contrary, the learned Sr. DR, Sh. Ravi Kant Gupta, relied upon the orders of the authorities below and objected to the above argument of Ld. AR of the assessee. He stated that AO had issued notice u/s. 148 of the Act on 14.3.2013 which was duly served upon the assessee. The Assessee vide letter dated 15.4.2013 has stated that return filed on 14.5.2010 may be treated as having been filed in response aforesaid notice. He further stated that on 27.9.2013 the AR of the assessee appeared and filed written submission which were duly examined and were not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts cases were covered under section 153A of the Act in respect of AY 2001-02 to 2007-08. Another search operations dated 29.04.2008 took place in the premises-of Spaze Group including the residential premises of the assessee, due to which its pending assessments proceedings under section 153A of the Act in respect of AY 2003-04 to AY 2007-08 abated by operation of the 2nd proviso to section 153A of the Act. Consequent thereto, the return of income for AY 2007-08 was filed by the assessee on 14.05.2010 at an income of ₹ 65,95,150/ - in response to notice dated 31.08.2009 issued, under section 153A of the Act. The assessment under section 153A(I)(b) of the Act was completed vide order dated 24.12.2010 at returned income of ₹ 65, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied and uncalled for. With regard to this ground, we find that the case of the assesee was reopened by issuing notice u/s. 148 of the Act on 14.3.2013 (PB-17) and in response to the same, the assessee has filed detailed objections (PB-23-46) against the notice of reassessment under section 147 of the Act and AO without disposing of the objections filed by the assessee, passed the assessment order u/s. 147 of the Act dated 30.9.2013 thereby making an addition of ₹ 18 acs on account of deemed dividend u/s. 2(22)(e) of the Act. We note that it is settled law that in case the objections were filed by the assessee against the notice u/s. 147 of the Act, then the AO is bound to dispose of the said objections by a comprehensive order, but in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing of the objections before passing the order of reassessment. 5.2 In view of the binding decision of the Hon'ble Supreme Court, as aforesaid, the re-assessment cannot be su tained. As observed herein above though the detailed objections were raised against reopening of the assessment, the AO did not dispose of the same till the conclusion of re-assessment proceedings and passed order under section 147 of the Act. 5.3 In the instant case Ld. CIT(A) at para 2 of page no.9 of the order has made an attempt to distinguish the decision of Hon'ble Supreme Court in the case of GKN Driveshafts (India) Ltd. by placing reliance on the decision of ITO vs. Smt. Gurinder Kaur (2006) 102 ITD 189 (Del ITAT) in which it was held that non ..... X X X X Extracts X X X X X X X X Extracts X X X X
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