TaxTMI 
TaxTMI 
TaxTMI 
2012 (3) TMI 737
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.... facts are same in the remaining appeals. Therefore, for the purpose of disposal of all the appeals, the facts noted in the case of assessee, Mr. Chakresh Kumar Jain, are considered and discussed. 4. Briefly, the facts are that according to the Assessing Officer, during the assessment proceedings of M/s. PNC Cold Storage Pvt. Limited, Kamla Nagar, Agra for the assessment year 2006-07, it came to light that the Company, M/s. PNC Cold Storage Pvt. Limited has given loan of Rs. 65,00,000/- to the assessee. Notice u/s. 148 was issued for taking recourse to the provisions of section 2(22)(e) of the IT Act. The assessee submitted before the Assessing Officer that the advance made by the company, M/s. PNC Cold Storage Pvt. Limited, was a trade advance and, therefore, provisions of section 2(22)(e) are not attracted. It was also submitted that the advance was not given out of accumulated profits subjected to dividend. It was also explained that the amount was received by the assessee from the company on account of imprest money. The imprest money was received for expediency of business of the company and to cater the need of business, which was also returned to the company. The Ass....
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....n such case, such advance or loan cannot be said to a deemed dividend within the meaning of the Act. Thus, for gratuitous loan or advance given by a company to those classes of share holders would come within the purview of section 2(22) but not to the cases where the loan or advance is given in return to an advantage conferred upon the company by such share holder. In the case before us, the assessee permitted his property to be mortgaged to the bank for enabling the company to take the benefit of loan and in spite of request of the assessee, the company is unable to release the property from the mortgage. In such a situation, for retaining the benefit of loan availed from Vijaya Bank if decision is taken to given advance to the assessee such decision is not to give gratuitous advance to its share holder but to protect the business interest of the company. The view we propose to take finds support from the two decisions, one of the Bombay High Curt and the other of the Delhi High Court relied upon by Mr. Khaitan as indicated earlier. We, therefore, find that the authorities below erred in law in treating the advance given by the Company to the assessee b....
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....ier inability to lead evidence should not be held against the assessee unless it is known to the Court or suggested to the Court or there was evidence to suspect that the evidence was fabricated. In the instant case, there was no such suggestion and, therefore, the assessee's evidence was to be admitted. The Commissioner (Appeals) was, therefore, directed to examine the payment of commission afresh and to issue orders accordingly." (ii). Rajmoti Industries vs. ITO, 52 ITD 286, in which it was held as under : "From a judicial analysis of various decisions, it is amply settled and clear that the Tribunal can admit additional evidence in terms of rule 29 of the Income-tax (Appellate Tribunal) Rules if the receipt or admission of additional evidence is vital and essential for the purpose of consideration of the subject-matter of the appeal and arrive at a final and ultimate decision. The Tribunal, therefore, has also power to admit additional evidence in the interest of justice or if there exists substantial cause." (iii) In Mahavir Prasad Gupta vs. JCIT, 101 TTJ (Del) 1078 it has been held that fresh evidence sought to be produced aimed at clearing an obscur....
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....he deep sense of appreciation for the valuable assistance made by the assessee for the benefit of the company in consideration above, financial assistance is provided and in alternate the company would help release the properties mortgaged by the above said bank and help discharge of the personal guarantees of the aforesaid assessees subject to the permission of the bank. The assessee also sought to admit additional evidence, which is copy of loan sanction letter of the bank to M/s. PNC Cold Storage Pvt. Limited. These additional evidences on record clearly support the case of the assessee that the properties of the assessees were mortgaged to the bank for benefit of company who have granted loans to assessees enabling the bank to take loan securities and the assessee stood guarantor for the same. Therefore, the benefit to business is availed to by the Company on securities being provided by the assessees against the loan so sanctioned by the Bank. The Company, in such situation, granted some benefit to them to protect business interest of the company. The assessee may have some case to argue on merits if additional evidences are admitted. As per decision of Hon'ble Calcutta High C....