2014 (7) TMI 309

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....od 1999-2000 to 2001-02, the assessee advanced amounts to M/s Pure Drinks (New Delhi) Ltd. The Assessing Officer held that the amounts so advanced were hit by the provisions of Section 2(22)(e) read with Section 194 of the Act and it was held that Mrs. Harjit Kaur is holding more than 10% of the voting power in assessee company indirectly through M/s Pure Drinks (New Delhi) Ltd. The CIT(A) has held that this is not a case which is hit by the provisions of Section 2(22)(e) read with Section 194 of the Act. The CIT(A) has also held that the proceedings initiated under Section 201(1)/201(1A) of the Act were barred by limitation in all the three years by following the decision of Hon'ble Jurisdictional High Court in the case of CIT Vs. NHK ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ngs goes to the root of the controversy and it is purely a legal ground, therefore, after hearing both the sides, we are admitting this ground for the decision. 5. The controversy involved in these appeals is related to the financial year 1999-2000 to 2001-02. The order under Section 201(1)/201(1A) of the Act was made on 31.3.2011. The order was made after a lapse of nine years from the end of FY 2001-02 and it was after eleven years from the FY 1999-2000. When the Additional Commissioner of Income Tax, Range-49, New Delhi initiated proceedings, the assessee took a plea that in view of the decision of Hon'ble Jurisdictional High Court in the case of NHK Japan Broadcasting Corporation (supra), the proceedings have got time barred. The l....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....that M/s Pure Drinks (New Delhi) Ltd. is not the shareholder of the assessee (company) ignoring the fact that payment to this entity is very much covered by the definition of 'dividend' under Section 2(22)(e) of the Act. 7. We have heard both the sides on the issue. The CIT(A) has granted relief to the assessee by holding as under:-     "Further even on merit also the appellant assessee has also been able to prove that the provisions of section 2(22)(e) of the I.T. Act are not applicable in the present case in as much as both the conditions of a shareholder holding 10% shares in the payer company and more than 20% beneficial stakes in the payee entity do not exist in the present case as clarified in the chart given above. F....