2010 (11) TMI 1093 - AT - Income Tax

Summary

Issues involved: Appeal against orders dated 5.2.2008 passed by ld. CIT(A)-IX for Assessment Year 2001-02 regarding assessment of deemed dividend u/s. 2(22)(e) of the Act.

Issue 1: Assessment of deemed dividend u/s. 2(22)(e) of the Act

The appellant contended that the assessment order wrongly assumed M/s. Lauren Information and Technologies Pvt. Ltd as a shareholder of the appellant company from 14.4.2000 to 31.3.2001, whereas the correct period was 16.3.2001 to 31.3.2001 due to a merger. The appellant faced challenges in providing the necessary documents to the AO due to shifting of records and resignations in key departments. The AO made an arbitrary addition as deemed dividend u/s. 2(22)(e) without proper verification. The appellant requested admission of additional evidence, citing Rule 29 of the I.T. Rules, 1963. The Tribunal, following precedents, allowed the appeals and remitted the issue back to the AO for reevaluation with all evidences considered.

Significant Phrases:
- Deemed dividend u/s. 2(22)(e) of the Act
- Rule 29 of the I.T. Rules, 1963
- M/s. Lauren Information and Technologies Pvt. Ltd
- Annual Return filed with the Registrar of Companies
- Shareholder holdings
- Addition as deemed dividend
- Merger process under the Companies Act, 1956
- Shifting of records to warehouse
- Unprecedented rains and floods in Mumbai
- Certified true copy of Annual Return
- Audited Balance Sheet
- Admissibility of additional evidence
- Rule 46A of the I.T. Rules, 1962
- Abhay Kumar Shroff case
- Remittance of issue back to the AO
- Tribunal's decision and reasoning