TaxTMI 
TaxTMI 
2017 (9) TMI 1936
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....aterials on record are as under:- In this case, assessee company is engaged in business of running Hotel and Restaurants. It was seen from Annexure-2 of Tax Audit Report that the following payments towards the contribution of employees' PF and ESI were not made within due dates. Provident Fund - CAMA Hotels Ltd. Month Employee's Contribution Due Date Paid Date J uly 9 09 43,368 20/08/2009 21/08/2009 Sep 9 09 43,339 20/10/2009 21/10/2009 Total 86,707 Provident Fund - CAMA Caterers Ltd. Month Employee's Contribution Due Date Paid Date J uly 9 7,630 20/08/2009 21/08/2009 Sep 9 6,982 20/10/2009 21/10/2009 Total 14,612 Provident Fund - CAMA Rajputana Club Resort Month Employee's Contribution Due Date Paid Date J uly 9 17,441 20/07/2009 27/07/2009 Sep 9 17,346 20/08/2009 31/08/2009 March 10 15,019 20/04/2010 22/04/2010 Total 49,806 ESI Contribution - CAMA Hotels Ltd Month Employee's Contribution Due Date Paid Date J uly 9 6,069 20/08/2009 21/08/2009 Se....
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....t has received new loan of Rs. 3.00 lacs & closing balance is Rs. 1,99,38,955/- (inclusive of interest of Rs. 27,00,936) as against opening balance of Rs. 1,69,38,020/-. Without prejudice to the above, we have to state that the above assessee company is a Public Limited Company and is not holding any share in the said companies. Moreover, though Shri Jehangir R. Cama, Mrs. Mehroo J. Cama and Shri Rustom J. Cama hold more than 10% of the Share Capital i.e. the voting power, none of them holds 20% or more of the Share Capital of the above assessee company. Therefore, the provisions of Section 2(22)(e) of the Act are not applicable at all on facts of the case and, hence, there is no question of taxing such amounts as 'Deemed dividend' in the hands of the above assessee company. In view of the facts of the case, there is no need to rely upon the decision of the special bench, Mumbai in the case of ACIT V. Bhaumik Colour Pvt. Ltd. reported in 118 I.T.D. 1 (Mum) (SB), a copy of which is enclosed herewith. As regards the Loan received from RJ. Cama & Co. Pvt. Ltd., we have further to state that the said company is in the business of borrowing money and l....
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....Court in the case of C.I.T. V. Parle Plastics Pvt. Ltd. reported in 236 CTR 382 (BOM). In view of the above, kindly not to apply provisions of Section 2(22) (e) in the hands of the company and oblige." The submissions of the assessee company have been considered the contention of the assessee that the assessee company is a Public Limited Company and is not holding any share in the said companies is not acceptable. 3. Against the said order assessee preferred first statutory appeal before the learned CIT(A) who partly allowed the appeal of the assessee. 4. We have gone through the relevant record and impugned order. Ld. AR stated that Cama Hotel Ltd. is not having any share holding in Cama Motors Pvt. Ltd. and issue is squarely covered in favour of the assessee. Similarly, matter came before the ITAT for Asst. Year 2009-10, in which assessee company had paid interest of Rs. 32,43,885/- to person covered u/s.40A(2)(b) of the Income Tax Act. He further observed that interest has been paid @15% in the case of Cama Motors Pvt. Ltd. and @16% in the case of R.J. Cama & Co. Pvt. Ltd. The ld. Assessing Officer has allowed the interest payment @12% and disallowed the balanc....
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.... not extended any undue benefit to the persons covered u/s.40A(2)(b) of the income Tax Act. 4.4 With regard to deletion of addition of deemed dividend u/s.2(22)(e) of the Act despite the fact that the assessee had itself received the said dividend as envisaged u/s.2(22)(e) r.w.s. 56 of the Act is concerned. Learned AR cited an order of assessee's own case, in the matter of DCIT(OSD) vs. M/s. Cama Hotels Pvt. Ltd. in ITA No.1834/Ahd/2012. Similar facts have been taken in this appeal which is filed by the department and appeal is dismissed for Asst. Year 2009-10. The brief facts of the case were that on perusal of the accounts, it reveals to the Assessing Officer that assessee has received an amount of Rs. 62,06,638/- from Cama Motors Pvt. Ltd. and received Rs. 1,69,38,020/- from R. J. Cama and Co. Pvt. Ltd. The ld. Assessing Officer has considered these loans as deemed dividend in the hands of assessee. He accordingly made addition of Rs. 2,63,12,188/- u/s.2(22)(e) of the Income Tax Act. On appeal, ld. CIT(A) has deleted the addition. 4.5 Learned AR at the very outset, submitted that issue in dispute is clearly covered in favour of assessee. He pointed out that assessee is not....
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....ent of CIT(A) vs. Gujarat State Road Transport Corporation, in which it is held (supra) the section 36(1)(va) of the Income Tax Act, 1961 read with subclause(x) of clause 24 of section 2 was applied, the assessee shall be entitled to deduction in computing the income referred to in section 28 with respect to such sum credited by the assessee to the employees' account in the relevant fund or funds on or before the "due date" mentioned in explanation to section 36(l)(va). Consequently, it is held that the learned tribunal has erred in deleting respective disallowances being employees' contribution to PF Account / ESI Account made by the AO as, as such, such sums were not credited by the respective assessee to the employees' accounts in the relevant fund on or before the due date as per the explanation to section 36(l)(va) of the Act i.e. date by which the concerned assessee was required as an employer to credit employees' contribution to the employees' account in the Provident Fund under the Provident Fund Act and/or in the ESI Fund under the ESI Act. Consequently, all these appeals are allowed and the impugned judgement and orders passed by the tribunal in del....