TaxTMI 
TaxTMI 
2012 (8) TMI 1057
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....Y 2005-06 especially when the Tribunal has erred ignoring the "substance" over the "form" without appreciating the fact that the amount received by the assessee was shown as unsecured loan. 2. During hearing, we have heard Shri R.A. Verma, ld. Sr. DR and Shri Tribhuvan Sachdeva, ld. Counsel for the assessee. At the outset, it was asserted by the ld. Counsel for the assessee that the impugned issue is covered in favour of the assessee by the decision of the Tribunal, that too, in own case of the assessee for AY 2005-06. This factual matrix was not controverted by the Revenue. 3. We have considered the rival submissions and perused the material available on record. In view of the above assertion, we are reproducing hereunder the relevan....
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.... not received as a loan but as an advance against sale of its land situated in Gram Sinhansa Tehsil and District Indore. To support the contention the assessee has filed agreement to sell dated 19.1.2004 before the Assessing Officer. However, the Assessing Officer was not convinced with the same and held that the transaction was in the nature of loans and advances. On finding that accumulated profit of the company was Rs. 58,43,165/- he restricted the addition u/s 2(22)(e) of the Act to the extent of accumulated profit i.e. Rs. 58,43,165/-. On appeal before the learned Commissioner of Income Tax (Appeals), the assessee contended that the amount was received as loans and advances. However, the learned Commissioner of Income Tax (Appeals) ....
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....from loans and advances to investment in the subsequent year. We, therefore, do not find any merit in the action of the lower authorities for treating the transaction as in the nature of loans and advances. The ground of the assessee is, therefore, allowed in his favour. Finally, the appeal of the assessee is partly allowed. Order pronounced in the open Court on 3rd January, 2012." 4. We find that vide order dated 3.1.2012 (supra), the Tribunal decided two issues pertains to the assessee. The issue towards addition made u/s 68 of the Act was decided against the assessee and the issue of deemed dividend u/s 2(22)(e) of the Act was decided in favour of the assessee. The ld. CIT(A) for AY 2005-06 directed that the addition to the extent of ....
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....anded as loans and advances. In view of these facts, we are of the considered opinion that such transactions would not come under the provisions of sec. 2(22)(e) of the I.T. Act, 1961. The ratio laid down by Hon'ble Madras High Court in the case of CIT vs. F. Parveen (2008) 222 CTR (MAD) 639 wherein the Tribunal found that the amount was transferred by the company to its director in the normal course of business and not as a loan, the addition towards deemed dividend u/s 2(22)(e) of the Act was held to be rightly deleted, supports the case of the assessee. Identically, in another case before the Hon'ble Delhi High Court in CIT vs. Rajkumar (2009) 318 ITR 462 it was held that the trade advance which is in the nature of money transact....