TaxTMI 
TaxTMI 
2022 (12) TMI 301
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....e Tax Act, 1961 (hereinafter "the Act") dated 30.12.2018. 2. At the outset, it is noted that this appeal of the Assessee is barred by limitation by 96 days and the learned Counsel for the Assessee drew our attention to Form No.36 and stated that the order of the Commissioner of Income Tax (Appeals) was received on 04.03.2020 and during the outbreak of 'Covid-19' pandemic. The Hon'ble Bench took into cognizance the Order of the Hon'ble Supreme Court the "Suo Moto WP 03/2020 dated 20.03.2020 while considering the condonation of delay. It is a fact that 'Covid-19' pandemic was prevalent during the period and in term of the directions issued by the Hon'ble Supreme Court in Miscellaneous Application No.21/2022 in Suo Motu Writ Petition No.3 of ....
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....ssessment completed u/s.143(3) of the Act cannot be re-opened on account of change of opinion on the same set of facts available with him during the original assessment." 4. The Assessee has raised Ground Nos.1 and 7 to 10 as regards to the addition made by the Assessing Officer and confirmed by the Commissioner of Income Tax (Appeals) on 'deemed dividend'. Firstly, we will decide the issue on merits, i.e., the deemed dividend u/s.2(22)(e) of the Act assessed by the Assessing Officer and confirmed by the CIT(A). The Ground Nos.1 and 7 to 10 raised by the Assessee are as under: "1) The CIT(A) erred both in law and on the facts of the case in treating an inter-Corporate Deposit received by the Appellant amounting to Rs.1,40,67,365/- from ....
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....eceived a loan to the tune of Rs.1,40,67,365/- from Questnet Enterprises Private Limited [QNEI] during the Financial Year 2010 - 2011 relevant to the Assessment Year 2011 - 2012. It was observed from the financials of QNEI that it has accumulated profit as on 31.03.2011 at Rs. 12,21,49,133/-. The Assessing Officer has brought out the shareholder pattern of both the companies, as under: Sl. No. Name of the Shareholder Percentage of share in Pallava Resorts Pvt. Ltd. Questnet Enterprises Pvt. Ltd. 1 Ms. Pushpam Appalanaidu 24.94% 75% 2 Mr. Joseph Augustine 2.77% 25% 3 Questnet Enterprises India Private Limited 72.29% 5.1 According to the Assessing Officer, the loan received by the Assessee from QNEI is to be treated a....
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.... case of Commissioner of Income Tax Vs. Ennore Cargo Terminal Private Limited reported in [2018] 406 ITR 477 (Mad) (HC) is pending before the Hon'ble Supreme Court in SLP filed by the Revenue and hence the claim of the Assessee is not acceptable. Therefore, by invoking the provisions of Section 2(22)(e) of the Act, the Assessing Officer made the addition of deemed dividend amounting to Rs.1,40,67,365/-. Aggrieved, the Assessee preferred an appeal before the Commissioner of Income Tax (Appeals). 6. The CIT(A) confirmed the addition by going through the provisions of Section 2(22)(e) of the Act and noted in paragraph nos.5.3.5 to 5.3.9, as under: "5.3.5 On reading of the above Section, it is clear that even if the loan or advance is provid....
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....Ennore Cargo Terminal Private Limited." Aggrieved, the Assessee is now in Appeal before the Tribunal. 7. We have heard the rival contentions and had gone through the facts and circumstances of the case. We note that the Assessee does not hold any shares in QNEI and that it is QNEI that holds 72.29% shares in the Assessee Company. The fact remains that under the Companies Act, 1956, as a subsidiary company of QNEI, it is illegal to have shares in its holding company. From the Balance Sheet filed by the Assessee, it is noticed that the Assessee does not have any investments and therefore it is clear that the Assessee does not hold share in QNEI. However, it is noticed from the submissions of the learned Counsel for the Assessee that the ho....
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....reported in [2012] 340 ITR 14 (Del.) wherein the Hon'ble Delhi High Court has held that the provisions of Section 2(22)(e) of the Act is not attracted if the recipient is not a shareholder. (b) The decision of the Jurisdictional High Court in the case of Commissioner of Income Tax Vs. Checkpoint Apparel Labelling Solutions India Limited reported in [2021] 276 Taxmann 312 (Mad.) wherein it has held that since the recipient of the loan was not a shareholder in a company from which loan was received, hence loan cannot be assessed as deemed dividend. (c) The decision of the Mumbai High Court in the case of Commissioner of Income Tax Vs. Jignesh P. Shah [2015] 372 ITR 392 (Bom.) wherein it has held that the provision of Section 2(22)(e) of the A....