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TMI Blog2015 (6) TMI 52X X X X Extracts X X X X X X X X Extracts X X X X ..... fully discharged. Once, it has been shown that the amount has been received not as loan but as deposits, the deeming fiction of 2(22)(e) cannot be stretched to hold that the payment made by a company to a shareholder by way of deposit in lieu of usage of property for its business purpose is in the nature of loan. It is a trite law that the deeming fiction has to be strictly construed and such legal fiction cannot be extended for any kind of payment by a company to its shareholder. Thus, on the facts and circumstances of the case, we find that the reasons recorded by the Ld. CIT(A) for deleting the penalty is legally and factually correct and accordingly the same is affirmed. - Decided in favour of assesse. - ITA No. 3767/Mum/2012 - - - D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that these amounts have been received towards deposits for the premises used by these concerns for their business. The AO further require to furnish documentary evidences like lease agreements to justify the claim. However, no further evidences was furnished by the assessee. Accordingly, he treated the said amount as a loan/advance given by these companies to the assessee and treated it as deemed dividend u/s 2(22)(e). 3. In the first appeal, the Ld. CIT(A) confirmed the said action of the AO on the ground that all the conditions mentioned u/s 2(22)(e) are fulfilled and therefore, the provisions of deemed dividend are squarely applicable. In the second appeal also, the Tribunal has confirmed the said addition on the ground that the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t all. The assessee has even filed Miscellaneous Application before the Tribunal to highlight this fact that these evidences were filed and referred before the Tribunal but has not been dealt upon and therefore, wrong finding of fact has been arrived. However, the Tribunal has dismissed the assessee s application on the ground that it is beyond the scope of section 254(2). It was further submitted that, not every amount received by the shareholder on account of the business dealing can be treated as loan or advance within the purview of section 2(22)(e). The security deposits received by these companies was for the use of the premises belonging to the assesseee and such a security deposit is nothing but received during the course of normal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g to the decision of Hon ble Supreme Court in the case of CIT Vs. Reliance Petro Products P. Ltd. reported in (2010) 322 TTR 158, he deleted the penalty. 7. Before us, the Ld. DR strongly relied upon the order of the AO and the finding given in the quantum proceedings and submitted that it could not be established by the assessee during the course of the quantum proceedings that the amount received by the assessee from the three companies was not in the form of loan or advance. Once, the Tribunal has given a category finding of fact, then penalty has rightly being levied by the AO. 8. On the other hand, learned counsel, Shri J. P. Baigara, submitted that the assessee was the owner of various properties which were given to the three co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled before the authorities during the quantum proceedings. Along with these details, the assessee had also filed internal bank payment voucher by these companies which show that amount has been given as deposit for the use of the property. These bank vouchers mentions the cheque number, name of the assessee, the amount of deposits given and the detail of the property. All these evidences though filed in the course of the quantum proceedings, have not been taken into cognizance by any of the appellate authorities. It has been brought to our notice by the learned counsel that, assessee has not received any rent from these companies, instead she had received only security deposits. In light of these facts, it cannot be conclusively held tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avour, because explanation merely raises a rebuttal presumption to which assessee can always discharge his onus by pointing out the factors relating to pre-ponderence of probability. Here in this case, the assessee s explanation that the money received from these companies were in the nature of refundable security deposits received by the assessee in lieu of letting of the properties owned by her has not been found to be false and in fact has been substantiated by the evidence in the form of internal bank vouchers and the entries in the books of account of the assessee as well as of the companies. The revenue has no material to rebut such an evidence or that the assessee s explanation is false based on material on record. The assessee s onu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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