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TMI Blog2016 (5) TMI 722X X X X Extracts X X X X X X X X Extracts X X X X ..... T(A) has considered the issue elaborately and upheld the additions made by the A.O. Therefore, we upheld the order of the CIT(A) - Decided against assessee - M.P. No.1/Vizag/2016 - - - Dated:- 7-4-2016 - SHRI V. DURGA RAO, JUDICIAL MEMBER AND SHRI G. MANJUNATHA, ACCOUNTANT MEMBER For The Appellant : Shri G.V.N. Hari, AR For The Respondent : Shri M.K. Sethi, DR ORDER PER G. MANJUNATHA, Accountant Member: This miscellaneous petition filed by the assessee, requesting for rectification of order passed by this Tribunal, in ITA No.180/Vizag/2011 dated 11.12.2015. 2. During the course of hearing, the Ld. A.R. of the assessee submitted that on going through the order passed by the Hon ble Bench, it is noticed that there was a mistake in non-consideration of coordinate bench decision of ITAT, Visakhapatnam in the case of Dr. Ch. Sri Padmavati Vs. DCIT in ITA No.624/Vizag/2013 dated 4.7.2014, which is a mistake apparent from the records, it requires rectification u/s 254(2) of the Income-Tax Act, 1961 (hereinafter called as the Act ). The Ld. A.R. further submitted that the solitary issue involved in this case is addition made u/s 2(22)(e) of the Act towards ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... total income of ₹ 6,55,900/-. The case was selected for scrutiny and accordingly notice u/s 142(1) of the Act along with questionnaire was issued to the assessee. In response to show cause notice, the assessee s authorized representative appeared from time to time and furnished the information called for. During the course of assessment proceedings, the assessing officer found that as per the books of accounts of NEPPP Ltd., the assessee has received an amount of ₹ 35,68,404/-. Since, the assessee was holding beneficial ownership in the company by holding more than 50% shares, the A.O. issued a show cause notice and asked the assessee to explain, why the amount received by her shall not be treated as deemed dividend u/s 2(22)(e) of the Act. In reply to the show cause notice, the assessee submitted that the amount received from the company was towards sale of the property, therefore, the provisions of section 2(22)(e) of the Act cannot be applied. She further explained that due to lack of liquidity of cash, she had decided to sell her property to the company and entered into an agreement of sale, for a consideration of ₹ 80 lakhs and received advance towards sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year 2005, whereas the stamp paper was purchased in 17.6.2003, therefore, doubted the genuineness of the agreement. The CIT(A) further observed that though the agreement to sale is entered in 2005, even at this stage, the sale is not complete. Therefore, the sale agreement cannot be accepted as a document in support of her claim. The CIT(A), further held that the assessee is trying to cover up the said advance by creating a fictitious sale agreement which cannot be accepted. Therefore, confirmed the additions made by the A.O. Aggrieved by the CIT(A) order, the assessee is in appeal before us. 7. The Authroised representative of the assesse, submitted that the debit balance appearing in the Company books in the name of the assesse is the advance paid for purchase of property. The A.R. further submitted that the assesse entered into sale agreement with the company and received money towards advance. The A.R. further submitted that she did not derive any individual benefit from the said amount, as the possession of property was already with the Company and company given the said property as collateral security to bank for availing loan for the company business. The A.R. further su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aper purchased almost 2 years back for entering the sale agreement. As stated by the CIT(A) in his order, the sale transaction is not completed even now. The assessee contended that since the company is unable to pay the agreed sale consideration, therefore the sale is deferred, but, failed to substantiate with any evidence. Therefore, we are of the opinion that the assessee is trying to circumvent the loan taken by her from the company by creating the sale agreement. On perusal of the sale agreement, we noticed that one of the condition of sale agreement is that the sale should be completed within one year from date of the sale agreement. The assessee could not adduce any reason for not completing the sale. It is quite unusual that agreement of sale has been prepared on stamp paper which was purchased almost two years back. Further, there is nothing in the company s books to indicate that any such transaction has been taken during the relevant financial year under consideration. The assessee is continuing to enjoy the benefits of the property by getting rent from the company. The assesse contention is that the property is given as collateral security to bank to avail the loan for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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