TMI Blog2018 (5) TMI 805X X X X Extracts X X X X X X X X Extracts X X X X ..... voking section 40(a)(ia) is not sustainable. - Decided in favour of assessee Addition on account of interest on bank accounts - Held that:- This issue is accordingly restored to the file of the A.O. with the direction to verify the claim of the assessee that the amount of interest in question has already been brought to tax in the hands of M/s. Anand Vinayak Coalfield Ltd. and if it is found to be correct, the addition made in the hands of the assessee on account of same income is liable to be deleted as the same would otherwise result in double addition. Ground treated as allowed for statistical purposes Deemed dividend under section 2(22)(e) - Held that:- The nomenclature by the assessee alone cannot determine the exact nature of r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osits, a cash flow statement was furnished by the assessee. From the perusal of the said cash flow statement, it was noticed by the A.O. that the expenditure of ₹ 2,06,737/- incurred by the assessee was not reflected in the said cash flow statement. He also noticed that personal and household expenses to the extent of ₹ 2,00,000/- of the assessee were not reflected in the said cash flow statement. He accordingly treated the cash deposits found to be made in the bank account of the assessee to the extent of ₹ 4,06,737/- as explained and made addition to that extent to the total income of the assessee under section 68 of the Act. On appeal, the Ld. CIT(A) confirmed the said addition. 4. We have heard the arguments of both ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly dismissed as not pressed. 6. The issue raised in ground no 3 relates to the addition of ₹ 7,14,436/- made by the A.O. and confirmed by the Ld. CIT(A) on account of disallowance of interest under section 40(a)(ia) for non deduction of tax at source. 7. During the year under consideration, the assessee had incurred interest expenditure of ₹ 7,14,436/- and after adjusting the same against interest income of ₹ 5,69,869/-, the balance amount of ₹ 1,70,630/- was claimed against directors remuneration. According to the A.O., the assessee was required to deduct tax at source from the payment of the said interest under section 194A and since the assessee had failed to comply with the said requirement, interest expend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t only to the extent of ₹ 44,345/-, he was called upon by the A.O. to explain the reason for non disclosure of the balance amount of bank interest. In reply, it was submitted by the assessee that the relevant fixed deposits with United Bank of India were actually belonging to M/s. Anand Vinayak Coalfield Ltd. after takeover of his propriety concern and the same by mistake confirmed in his name in the bank record and even the tax was deducted at source by the bank with his PAN. This explanation of the assessee was not found acceptable by the A.O. in the absence of any supporting evidence and the balance amount of bank interest of ₹ 3,39,949/- was added by him to the total income of the assessee. On appeal, the Ld. CIT(A) confirme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT(A) on account of deemed dividend under section 2(22)(e) of the Act. 13. As found by the A.O. from the cash flow statement furnished by the assessee, the assessee had received total amount of ₹ 28,96,502/- from M/s. Anand Vinayak Coalfield Ltd. According to the A.O., the said amount received by the assessee was in the nature of loans and advances and since the provisions of section 2(22)(e) were applicable, he invoked the same and added the amount of ₹ 28,96,502/- to the total income of the assessee by treating the same as deemed dividend. On appeal, the Ld. CIT(A) confirmed the addition made by the A.O. on this issue. 14. We have heard the arguments of both the sides on this issue and also perused the relevant material ..... X X X X Extracts X X X X X X X X Extracts X X X X
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