2015 (9) TMI 1003 - AT - Income Tax

Deemed dividend u/s. 2(22)(e) - CIT(A) deleted the additions - Held that - The opening balance of ₹ 5,35,396 is receivable by assessee from the said company as on 1st April 2006 and to the extent amount received back cannot be added as deemed dividend u/s 2(22)(e) of the Act as it is the return of loan given by assessee to Koradia Construction Private Limited. The assesee has produced statement of account as well bank statement of the assessee to prove his contention. Further the assessee has earned ₹ 2,00,000 as the salary from Koradia Construction Pvt. Ltd., which has already been offered for taxation by the assessee in the return of income filed for the impugned year. Thus, in view of above we hold that CIT(A) has rightly deleted the addition to the tune of ₹ 12,10,396 and we uphold the same. - Decided in favour of assessee. Addition on account of income from house property - CIT(A) deleted the additions - Held that - Though the order of CIT(A) is short on details, so however, the factual matrix which has been brought out by the assessee, does not justify any interference in the ultimate conclusion drawn by the CIT(A). Moreover, we find that the assessee had brought to the notice of the Assessing Officer all the facts by way of a written communication dated 25/11/2009, copy of which has also been placed in the paper book at pages 110 to 111. Therefore, it is not a case where any fresh facts are being pleaded. Considering the entirety of the circumstances and in the background that the facts were already before the Assessing Officer, which have remained un-rebutted and also the precedent on similar issue in the case of assessee s husband, Shri. Binal S. Koradia, we hereby uphold the ultimate decision of CIT(A) in deleting the addition under the head income from house property . The order of CIT(A) is hereby affirmed.- Decided in favour of assessee.

Summary

Issues involved:
1. Deemed dividend u/s. 2(22)(e) - Relief granted by CIT(A)
2. Addition of income from house property - Deletion by CIT(A)

Deemed dividend u/s. 2(22)(e):
The Revenue appealed against the CIT(A)'s order granting relief of Rs. 12,10,396 to the assessee regarding the addition made as deemed dividend u/s. 2(22)(e). The Revenue contended that the additional evidence produced by the assessee was not examined by the Assessing Officer and lacked material to show reasonable cause for its late submission. The Tribunal noted that the amount in question comprised the opening balance receivable by the assessee from a company in which she held shares, along with subsequent transactions. The Tribunal upheld the CIT(A)'s decision, stating that the amount received back by the assessee was a return of a loan given to the company, not subject to deemed dividend treatment. The Tribunal also considered the salary income already offered for taxation by the assessee, leading to the dismissal of the Revenue's appeal on this ground.

Addition of income from house property:
The second issue pertained to the deletion of an addition of Rs. 8,59,873 on account of income from house property by the CIT(A). The Assessing Officer had added this amount as income from house property, alleging non-disclosure of rental income from various properties owned by the assessee. The CIT(A deleted the addition, citing it as baseless and presumptuous without providing concrete reasons. The Tribunal examined the factual matrix and submissions made by the assessee, highlighting discrepancies in the Assessing Officer's basis for the additions. The Tribunal agreed with the CIT(A)'s decision, emphasizing that the facts were already before the Assessing Officer and remained unchallenged. Additionally, a precedent involving a similar issue with the assessee's husband supported the deletion of the addition. Consequently, the Tribunal affirmed the CIT(A)'s decision to delete the addition under the head of income from house property, leading to the dismissal of the Revenue's appeal.

In conclusion, the Tribunal upheld the CIT(A)'s decisions in both issues, dismissing the Revenue's appeal and providing detailed reasoning for each issue based on the facts and legal provisions presented during the proceedings.