9911796707
TMI Blog2012 (3) TMI 189X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Commissioner of Income-tax(Appeals)-V at Chennai, dated 2-5-2011. 3. The appeals in the cases of Shri Gurbinder Singh and Shri Harbinder Singh arise out of the assessments completed under section 143(3) read with section 147 of the Income-tax Act, 1961 for the assessment years 2005-06, 2006-07 and 2007-08. The appeals for the assessment year 2008-09 arise out of the assessment completed under section 143(3). In the case of the appeals filed against Shri Harinder Singh, all the appeals arise out of the assessments completed under section 143(3) read with section 147 of the Income-tax Act, 1961. 4. In all these appeals, the grounds raised by the Revenue are common. The grounds relate to the single issue of applying the deeming provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome-tax (Appeals). 7. The Revenue is aggrieved and, therefore, these appeals before us. It is the common ground of the Revenue that the Commissioner of Income-tax(Appeals) has erred in holding that the amounts paid to the assessees by means of journal entries in the books of accounts of the company shall not be taxed as deemed dividends under section 2(22)(e) of the Act. It is the case of the Revenue that section 2(22)(e) does not stipulate that addition should be made only on actual payment basis. The Revenue contends that when an entry in the books of the company is passed in favour of the assessee, that would amount to receipt in the hands of the assessee, either now or later. The Revenue has also pointed out that the amounts were acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. CIT [1963] 49 ITR 287. He further explained that while accepting the contentions of the assessees that the amounts given to them in the period relevant to the assessment year 2008-09 were made against purchase of properties, the learned Commissioner of Income-tax contended that the Commissioner of Income-tax(Appeals) has relied on materials placed before him for the first time without giving an opportunity to the assessing authority. 11. The learned chartered accountant appearing for the respondent-assessees contended that the Assessing Officer has jumped into a conclusion in treating all the journal entries as instances of deemed dividends without verifying the context in which the journal entries were passed and without examining the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The assessing authority should have examined every journal entry conferring credit to the assessees and verify whether any fund/benefit has been transferred by the company to the assessees directly or indirectly. The assessing authority should examine the context in which the credit entry was passed. The assessing authority should also examine the purpose for which the journal entries were passed. The assessing authority should further examine whether the assessees have drawn funds from their accounts and from the company in the backdrop of the earlier credits transferred to their personal accounts by means of journal entries. All these matters have to be looked into. Without making any such enquiry, it is not possible for the assessing aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Commissioner of Income-tax(Appeals) for the assessment year 2008-09 and remit back the issue to the assessing authority. The assessees are directed to produce evidences before the assessing authority to prove their cases that the amounts were paid to the assessees by the company for the purpose of acquiring properties in its name. 15. In result, we have set aside the orders of both the assessing authority and the Commissioner of Income-tax(Appeals) for all the four assessment years under appeal. The files are remitted back to the assessing authority. He is directed to examine the evidences and details with reference to the issues and arrive at a lawful conclusion, before which he shall provide ample opportunities to the assessees t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
