2022 (5) TMI 1323

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....stances of the case and in law the Hon'ble CIT(A) erred in upholding the reopening of completed assessment made by the Ld. AO by issuing notice u/s. 148 of the IT Act 1961 and the reasons assigned for doing so are wrong and contrary to the provision of the Income Tax Act and rules made there under. 2. On the facts and in the circumstances of the case and in law the Hon'ble CIT(A) erred in upholding the addition of Rs.87,91,502/- made by the Ld. AO by invoking provisions of section 2(22)(e) of the Act and the reasons assigned for doing so are wrong and contrary to the provision of the Income Tax Act and rules made there under" 3. The issue raised in ground No.1 is against the order of Ld. CIT(A) upholding the reopening of assessm....

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....al of the assessee. 6. The Ld. A.R. vehemently submitted before us that the reopening of assessment under section 147 of the Act has been invalidly made by the AO without being there any tangible and new material for reopening the assessment. The Ld. A.R. drew our attention to the reasons recorded under section 148(2) of the Act which are reproduced at page No.2 of the assessment order and stated that on the very first line the AO has stated that on verification of the assessment records and therefore the AO on the basis of the records which were available during the original assessment proceedings were re-appreciated and reviewed and the reopening has been made on the basis of old material which were before the AO in the original assess....

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....n verification of the case records, it is seen that the assessee company has received unsecured loan and advance from M/s. Vananchal Infrastructure Put Ltd. (M/s. VIP Ltd) during the year ending March, 2012. M/s. VIPL is a sister concern in which the public is not substantially interested and the assessee company is holding more than 10% of the voting power. As M/s. VIPL is possessing accumulated profits of Rs.87,91,502/-, the loans and advances received by the assessee company to the extent of Rs.87,91,502/- should have been treated as receipt of dividend under section 2(22)(e) of the IT. Act, 1961. Further, it is seen that there is nothing on record to indicate that the order u/s. 143(3) has deliberated on the issue of deemed div....