2018 (1) TMI 1079

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....wing two questions stated to be substantial questions of law: "[A] Whether the Appellate Tribunal erred in law on facts in deleting the addition of Rs. 1,19,23,142/- under section 69B of the Act? [B] Whether the Appellate Tribunal erred in law on facts in deleting the addition of Rs. 97,56,376/-?" 2. The assessment year is 2010-11. The assessee company is engaged in the business of manufacturing and trading of tiles. The assessee filed return of income on 30.9.2010 declaring total income of Rs. 14,68,702/-. The case was taken up for scrutiny. During the course of scrutiny assessment proceedings, the Assessing Officer noticed that the assessee was enjoying cash credit facility from Dena Bank against hypothecation of stock. Upon verifyin....

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....ts of the case. The Assessing Officer held otherwise and made an addition of Rs. 97,56,379/- as deemed dividend under section 2(22)(e) of the Act. The assessee carried the matter in appeal before the Commissioner (Appeals), who held in favour of the assessee. Revenue went in appeal before the Tribunal, but did not succeed. 4. Mr. M.R. Bhatt, Senior Advocate, learned counsel for the appellant assailed the impugned order by reiterating the grounds set out in the memorandum of appeal and in the assessment order. 5. Insofar as the issue raised vide proposed question "A" is concerned, a perusal of the impugned order reveals that the Tribunal has compared the stock statement for the year under consideration as per the books of accounts and as s....

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....nal suffers from any legal infirmity. 6. As regards proposed question "B", section 2(22)(e) of the Act says that "dividend" includes any payment by a company by way of advance or loan to a shareholder, being a person who is the beneficial owner of shares holding not less than ten percent of the voting power, or to any concern in which such shareholder is a member or a partner and in which he has a substantial interest or any payment by any such company on behalf, or for the individual benefit, of any such shareholder, to the extent to which the company in either case possesses accumulated profits. In the present case, the assessee has not made any payment by way of advance or loan to a shareholder, but on the contrary, has received a loan ....