TaxTMI 
TaxTMI 
2017 (10) TMI 997
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....ent act committed by the officer of the bank. (ii) On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in ignoring the contention of the assessee that the abovesaid amount was not in the nature of loans and advances. 4. Without prejudice to the above and in the alternative, the learned CIT(A) has erred both on facts and in law in rejecting the contention of the assessee that the computation of 'accumulated profits' made by the AO is wrong. 5(i) On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the disallowance of an amount of Rs. 34,27,655/- being deduction under Section 54 of the Act despite the assessee being eligible for the same. (ii) That the disallowance of exemption under Section 54 amounts to double addition, the assessee himself added the same in subsequent assessment year. 6. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the action of the AO in disallowing an amount of Rs. 1,13,375/- being brokerage and legal expenses, while computing capital gain on sale of property bearing No. B-7,....
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....g an addition of Rs. 30938391/- on account of deemed dividend and addition of Rs. 3948167/- be re-computing the capital gain declared by the assessee. The AO has also completed the assessment of company M/s Craftpac Containers Pvt. Ltd. whereby he made an addition of Rs. 10035866/- on account of deemed dividend. The AO completed the assessment at Rs. 3,77,96,067/- vide order dated 28.2.2014 passed u/s 143(3) of the Act. 3. Aggrieved with the assessment order dated 28.2.2014, the assessee preferred an appeal before the Ld. CIT(A), who vide his common impugned order dated 12.10.2016 has dismissed the appeal of the assessee and deleted the addition of Rs. 1,00,35,866/- of the case i.e. Craftpac Container Pvt. Ltd. 4. Against the common impugned order dated 12.10.2016, assessee has filed the Appeal before the Tribunal. 5. At the time of hearing, Ld. Counsel of the assessee has filed a Paper Book containing pages 1 to 119 containing various documents filed during the course of assessment and appellate proceedings. However, with regard to addition of Rs. 3,09,38,391/- confirmed by the Ld. CIT(A) on account of the deemed dividend has stated that the transaction reflected in the bank st....
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....penditure incurred on legal and brokerage at the time of sale of above property, Ld. Counsel of the assessee has stated that the as per the provisions of the Section 48, the capital gain is to be completed after deducting from the actual consideration received, the expenditure incurred in connection with such sales, hence, he requested that the addition in dispute may be deleted. 6. On the contrary, Ld. DR relied upon the orders of the authorities below and filed the written submissions citing therein the various case laws. The case laws cited by the Ld. DR in the written submissions are reproduced hereunder :- "In the above case, it is humbly submitted that the following decisions may kindly be considered while adjudicating the issue of addition made by the Ld. AO u/s 2(22)(e) of the IT Act 1961: "1. Miss P. Sarada Vs CIT [96 Taxman 11. 229 ITR 444.144 CTR 209] (Copy Enclosed) where Hon'ble Supreme Court held that advances made by company to assessee would have to be treated as deemed dividends paid on dates when withdrawals were allowed to be made and subsequent adjustment of account made on very last day of accounting year would not alter position that assessee receive....
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....y of ledger account of M/s CPC Polymers Pvt. Ltd. from 10.4.2010 to 31.3.2014 (filed in the Case of M/s Craftpac Containers Pvt. Ltd.); List of shareholders, copy of ledger account of Sh. Harish Kanwar from 1.4.2010 to 31.3.2011, copy of acknowledgement of income tax return alongwith computation of income for AY 2011-12, copy of Audited Balance Sheet and profit and loss account for the year ending on 31.3.2011 alongwith Directors Report, copy of ledger account of M/s Craftpac Containers Pvt. Ltd. from 1.4.2010 to 31.3.2012, copy of bank statement from 1.4.2011 to 31.12.2011 (filed in the case of CPC Polymers Pvt. Ltd.); copy of bank statement of Harish Kanwar from 1.4.2011 to 31.12.2011; copy of affidavit of Sh. Harish Kanwar; Details of calculation of Deemed Dividend u/s 2(22)(e) of the Income Tax Act for AY 2011-12; copy of Draft in the name of M/s Craftpac Containers Pvt. Ltd; copy of letter regarding encashment of FD filed by M/s Craftpac Containers Pvt. Ltd. to Citi Bank, dated 30.12.2009; copy of rely by Citi Bank Official, dated 7.1.2011; copy of letter from Citi Bank, dated 14.1.2011 alongwith following: Copy of preliminary account reconciliation statement, copy of settleme....
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....ade on the allegation that assessee received Rs. 3,01,00,000/- from Craftpac Containers Pvt. Ltd. and Rs. 99,00,000/- from CPC Polymers Pvt. Ltd. which in turn were used for making FDR in the name of Craftpac Containers Pvt. Ltd. with Citi Bank. The addition has been restricted to the accumulated profit of Rs. 2,09,02,255/- in the case of Craftpac Containers Pvt. Ltd. and Rs. 1,00,35,866/- in the case of CPC Polymers Pvt. Ltd. merely on the allegation that while preparing for the funds were routed through the account of the assessee. ln this regard it is pertinent to note that there was a fraud committed by the Relationship Manager of the Citi Bank Gurgaon whereby he induced various corporates to get an FDR prepared and have a return of 24% per annum. In this process he got cheques signed from the directors of the various corporates. lnstead of getting these funds transferred in the name of the corporates, the Relationship Manager fraudulently diverted the, funds by using the bank account of the individual director. The case of the assessee is one of the same. It was never intended that the FDR was to be prepared in the name of the assessee. The funds were supposed to be transferre....
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.... way of an advance or loan. The advance or loan has to be made, as the case may be, either to a shareholder, being a beneficial owner holding not less than ten per cent of the voting power or to any concern to which such a shareholder is a member or a partner and in which he has a substantial interest. The Tribunal in the present case has found that as a matter of fact no loan or advance was granted to the assessee, since the amount in question had actually been defalcated and was not reflected in the books of account of the assessee. The fact that there was a defalcation seems to have been accepted since this amount was allowed as a business loss during the course of assessment year 2006-07. Consequently, according to the Tribunal the first requirement of there being an advance or loan was not fulfilled. In our view, the finding that there was no advance or loan is a pure finding of fact which does not give rise to any substantial question of law." ii). In the case of Shri Harsh Dhir, Versus Income Tax Officer, Ward 10 (3) , New Delhi 2014 (10) TMI 847 - ITAT DELHI similar proposition was laid down. "9. The sum of Rs. 1 lakh was paid by DIPL to the assessee on 23rd April, 200....
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....t the Tribunal concluded that this is not a loan or advance so as to attract section 2(22)(e). We are not required to go into any further controversy or larger question. The Tribunal may have addressed itself to the status of Mr. Manish Oedhia and the financial position of M/s. Power Service Corporation possibly to take care of the argument of the revenue that these were entities closely connected and possibly the money was routed through them although there was no genuine business transaction. In taking care of that argument, the status and financial position of all the entities, their annual income has been referred by the Tribunal. Once, we are of the view that the transaction essentially carried out in this case is not falling under section 2(22)(e), then, the finding of fact rendered by the Tribunal cannot be said to be perverse or vitiated by any error of law apparent on the face of the record." v). Income Tax Officer, Ward-9 (1) Kolkata Versus Bimal Kumar Khaitan 2016 (3) TMI 443 - ITAT KOLKATA has confirmed the decision of Ld.CIT(A) and Ld CIT(A) held as under: "5.9. CIT(A) also held that since the money in question remanded with the assessee only for one day and was r....
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....e note that the AO had disallowed this expenditure on the ground that assessee has not filed the details. This is factually incorrect. A sum of Rs. 2,26,750/- was paid to Noida Authority as one time lease charges at the time of purchase of the Plot. The evidence of the same was submitted placed at PB. Pg. 99 along with the bank statement at page 101 whereby a sum of Rs. 113375/- (being 50% share. of the assessee of Rs. 226750) is the debit appearing. Thus, the same being cost of acquisition it was rightly deducted while computing capital gain. Before the AO assessee submitted the ledger Account (PB Pg.99) of the property showing the amount of expenses paid to Noida Authority and the same was co-related with the bank statement at PB Pg. 101 where in PO is made on 30.6.2010 for making payment to Noida Authority. In our view the Ld. CIT(A) has gone wrong ignoring these evidences and confirming the disallowance made by the AO, hence, the addition in dispute is deleted. 12. Apropos Ground No.7 which is relating to disallowance of deduction of Rs. 200000/- being the expenditure incurred by the assessee in respect of property bearing No. S-143, Greater Kailash, Part-II, New Delhi. This a....