AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2023 (1) TMI 128
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....unt not credited to Profit and Loss Account as per schedule A-OI of return 3. Large value sale of futures (derivative) in a recognized stock exchange reported in Securities Transaction Tax Return (STT Code 5). 4. Mismatch in sales turnover reported in Audit Report and ITR 5. Large value sale of futures (derivative) in a recognized stock exchange reported in Securities Transaction Tax Return (STT Code 5)." 2.1 The above issues were being examined by the Assessing Officer and no adverse inference was been drawn, thereby completed assessment under Section 143(3) vide order dated 22.12.2017 accepting the Returned Income of Rs. 97,58,260/-. 3. Perusal of above assessment order by the Ld. PCIT the assessee has received a loan of Rs. 88,25,649/- from Leela Tubes Pvt. Ltd. in which the assessee had 51.42% share and also key managerial personnel in the company having more than 20% share holding during the Financial Year. It is further seen that as on 31.03.2015, the Reserve and Surplus and Profit & Loss Account is Rs. 38,41,609/-, as per Section 2(22)(e) of the Act, why the same be treated as deemed income in the hands of the assessee. Thus, the Assessing Officer failed to consi....
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....travelled upto the Income Tax Appellate Tribunal by the assessee and Hon'ble Tribunal decided the matter in favour of the assessee by deleting the addition made under Section 2(22)(e) of the Act vide order dated 25.09.2018 in ITA No. 382/Ahd/2017. For the above reasons the assessee pleaded to drop the revision proceedings initiated under Section 263 of the Act. 4.2 The above reply was considered by the Ld. PCIT and part of it is reproduced in the impugned order, but very conveniently reference made by the assessee on the Tribunal decision for the A.Y. 2013-14 in assessee's own case, deleting the addition made under Section 2(22)(e) is not reproduced by the PCIT. However, Ld. PCIT set-aside the assessment order stating that is erroneous and prejudicial to the interest of revenue thereby directing the Assessing Officer to pass fresh assessment order, after giving proper opportunity to the assessee and examine the issue to ascertain the applicability of Section 2(22)(e) of the Act. 5. Aggrieved against the same assessee is in appeal before us raising the sole ground of appeal as follows: "1. In view of the facts and circumstances of the case, the Ld. Prin. CIT ought to have accept....
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....d also gone through the relevant record and impugned order. The assessee is an individual and Director in Leela Tubes Private Limited with shareholding exceeding the specified limit. The company Leela Tubes Private Limited set up a project at Daman in the year 2000-2011 with the help of bank finance and was also enjoying the working capital facilities. Initial couple of years were the period of establishing the product in market but during the year 2004-05, due to inability to retire the Letter of Credits opening by the Bank in favour of the suppliers of raw-material, there was very huge default and the company went into near bankrupt situation. The company was declared NPA. Meanwhile, the bank the United Western Bank Ltd. who were the bankers of the company also came into financial problem and that bank was acquired by IDBI Bank Ltd. As a result, the company was in a fix and it was empiric. IDBI Bank insisted for the very strict restricting of the loans and for that the several conditions were laid down. As a result, neither the bankers of the Company IDBI Bank Ltd. were giving the credit facilities and because of the defaults, the bankers were not allowing the company to pay to t....
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.... of the company and assessee even sought help from his relatives and placed as security the ancestral House being Flat No.203 at Shripalnagar, Ahmedabad. Therefore, in our considered opinion, this was for the business expediency and same cannot be treated as deemed dividend u/s.2(22)(e) of the Act. Thus, we direct the Assessing Officer to delete the addition of Rs.10,80,994/-. As a result, Assessee's ground of appeal is allowed. 9. In the result, Assessee's appeal is allowed." 8. The Ld. D.R. appearing for the Revenue could not state whether the Revenue has filed any appeal against the above order of the Tribunal before Hon'ble High Court of Gujarat. The Ld. PCIT before passing this Revision order has not given due weightage to the Appellate order passed by the Tribunal, which is against the fundamental principle of Judicial Discipline, that is required to be followed by all the lower authorities. Not following the Judicial Discipline by the highest Officer of the Income Tax Department is highly deprecated. 9. In this connection, it is appropriate to rely upon the celebrated judgment of the Hon'ble Supreme Court in the case of Union of India & Others vs. Kamlakshi Finance Cor....