2014 (6) TMI 145

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..... CIT ORDER Per Vikas Awasthy, J.M: The Miscellaneous Petition has been filed by the assessee seeking rectification of the order of the Tribunal dt.28-10-2011 in ITA No.527/Mds/2011 for the AY.2007-08. The assessee is aggrieved by directions of the Tribunal to tax deemed dividend in the hands of the partners. The relevant extract of the prayer of the assessee in the petition for rectification i .....

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..... 6.2 inasmuch as the findings of the First Appellate Authority in treating the sum of Rs. 3 Crores received by the Petitioner/Respondent from the company as deposits and not as loan or an advance has reached finality. Moreover, the Bench without posed with grounds of appeal by the department in the original appeal proceedings questioning the nature of the amounts received by the Petitioner/Responde .....

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..... senting the Department submitted that there is no error in the order of the Tribunal. The ld.DRs pointed out that in proceedings before the First Appellate Authority, the assessee had admitted that deemed dividend u/s.2(22)e is taxable in the hands of the shareholders of the company and not in the hands of the assessee-firm. The directions of the Tribunal are based on the admission made by the ass .....

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..... before CIT(Appeals). The relevant extract of the order of CIT(Appeals) wherein the assessee had conceded that the deemed dividend is taxable in the hands of the shareholders is re-produced herein below:  "6.3 The ld.AR has also argued in the alternative, that deemed dividend u/s.2(22)(e) is taxable only in the hands of the shareholders of the company and not in the hands of the appellant fi .....

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..... tions on its own. The directions against which the assessee is aggrieved are based on the admission of the assessee before the CIT(Appeals). We are of considered opinion that there is no error as alleged by the ld.AR of the assessee in the order of the Tribunal. The Miscellaneous Petition of the assessee is dismissed being devoid of merits. 5. However, we would like to observe that the Assessing .....

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