9911796707
TMI Blog2022 (11) TMI 309X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee are as under: "(1)The order passed u/s. 263 of the Income-tax Act, 1961 by the Principal Commissioner of Income-tax, Jamnagar is bad in law as well as on facts. (2) The order passed by the Principal Commissioner of Income-tax, Jamnagar by invoking the provisions of section 263 and thereby directing the Assessing officer to add Rs 53,48,045 as against the peak outstanding amount taken by Assessing officer after proper application of mind cannot be considered as erroneous in so far as it is prejudicial to the interest of the revenue to that extent and directing the Assessing Officer to consider the addition u/s. 2(22)(e) to the extent of accumulated profits of the company at Rs. 53,48,045/-. (3) On the basis of the facts a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held company had made financial transactions with assessee's proprietorship concern, viz. Shree Ashapurna Service. The AO had held that these transactions to be covered under section 2(22)(e) of the Act so as to be treated as deemed dividend and noting the fact that the amounts given by TSPL were returned also by the assessee during the year, he had worked out the amount withdrawn by the assessee from TSPL as amounting to Rs.3,77,450/-, by taking overdrawn balance twice during the year of Rs.2,000/- on 7.4.2011 and Rs.52,000/- on 16.4.2011 and including therein opening negative balance of Rs.3,25,415/-. The assessee had furnished this working of outstanding credit balance which is reproduced at page no.3 and 4 of the Ld.Pr.CIT's order as u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be treated as aid against outstanding balance and not against new amount withdrawn by the assessee. As such, the assessee's contention that the outstanding debit balance at the Beginning of the year is to be ignored to ascertain the so called loan is neither tenable nor acceptable. From this point of view, the outstanding balance on a particular date would be the amount overdrawn by the assessee on that day and as such, whenever the assessee overdraws from the company, it has to be treated as deemed dividend within the meaning of the provisions of section u/s. 2(22)(e) of the Act. A perusal of the above table reveals that the assessee has overdrawn on various occasions, for example, Rs.377415/- on 16.04.2011 Rs. 199565/- on 26.05.2011 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt of the assessee with Tristar Security Pvt. Ltd., wherein the impugned amounts have been received, is undisputedly in the nature of a current account with numerous transactions of giving and receiving amounts to the said company. This is a fact on record and is not disputed. The assessee had explained the nature of transactions between the two as relating to lending and receiving back money from the said company by the assessee to help it tide over short term financial requirements.This explanation of the assessee is reproduced at para 5 of the Ld.PCIT's order. No infirmity has been pointed out by the Ld.PCIT in the same. His only contention is that excess receipt by the assessee on each date is to be calculated by including the opening ..... X X X X Extracts X X X X X X X X Extracts X X X X
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