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TMI Blog2019 (9) TMI 1572X X X X Extracts X X X X X X X X Extracts X X X X ..... d out by the A.O - Decided against revenue. - ITA No. 7444/Mum/2016 - - - Dated:- 18-9-2019 - SHRI M. BALAGANESH, ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, JUDICIAL MEMBER For the Appellant : Shri Rite sh Mishra, Sr. D.R For the Respondent : Shri K. Gopal, A.R ORDER PER RAVISH SOOD, JM The present appeal filed by the assessee is directed against the order passed by the CIT(A)-4, Mumbai, dated 12.09.2016, which in turn arises from the order passed by the A.O under Sec. 143(3) of the Income Tax Act, 1961 (for short Act‟) for A.Y. 2013- 14,dated03.03.2016. The assessee has assailed the impugned order on the following grounds of appeal before us: 1. Whether on the facts and circumstances of the case and as per law, the Ld. CIT(A) has erred in directing to delete the addition made u/s 2(22)(e) of the Income-tax Act, 1961 in respect of the advance of ₹ 1,72,10,898/- received from M/s Gayatri Films Music Pvt. Ltd. (for the sake of brevity, GFMPL) was perverse, since the findings of fact given in the order of Ld. CIT(A) are inconsistent with the material on record? 2. Whether on the facts and circumstances of the case and as per law, the Ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e said concerns were treated by the A.O as deemed dividend‟ u/s 2(22)(e) in its hands, for the reason, that as per him one of its shareholder viz. Mr. Jyoti Sagar was having substantial shareholding in both of the aforesaid lender companies. On a perusal of the records, it was observed by the CIT(A) that the A.O for the purpose of working out the shareholding of Mr. Jyoti Sagar in the assessee company, had clubbed his individual shareholding with that which was held by him as an executor of the estate of Shri Subhash Sagar (for Mrs. Rekha Sagar Others). Also, a similar clubbing was carried out by the A.O for arriving at a substantial shareholding of Mr. Jyoti Sagar in the aforesaid two companies viz.(i). M/s Gayatri Films Music Pvt. Ltd; and (ii). M/s Sagar Entertainment Ltd. Accordingly, the claim of the assessee that neither of its shareholders were having a substantial shareholding in either of the aforesaid companies was rejected by the A.O. Also, the claim of the assessee that till 31.03.2013 it had received a total sum of ₹ 6,64,63,007/- from M/s Gayatri Films Music Pvt. Ltd (including an amount of ₹ 1,72,10,898/- received during the year viz, A.Y 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of the shareholder of M/s Sagar Entertainment Pvt. Ltd. was having a shareholding of not less than 20% in the assessee company; and (ii). that, the assessee had received the amount from the said company for coproduction of a serial. Accordingly, the CIT(A) was of the view that in the absence of substantial shareholding of any of the shareholder of M/s Sagar Entertainment Pvt. Ltd. in the assessee company viz. Sagar Arts Pvt. Ltd, the amount so received could not be treated as deemed dividend‟ u/s 2(22)(e). Also, taking cognizance of the fact that the amount was received by the assessee from the aforesaid company viz. M/s Sagar Entertainment Pvt. Ltd. for co-producing of a T.V Serial, the CIT(A) being of the view that as the same was to be treated as an intercorporate deposit, therefore, the provisions of Sec. 2(22)(e) on the said cunt also would not be attracted. On the basis of his aforesaid observations, the CIT(A) vacated the additions made by the A.O u/s 2(22)(e) of the Act. 5. The revenue being aggrieved with the order of the CIT(A) has carried the matter in appeal before us. We have heard the authorised representatives for both the parties, perused the orders of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usic Pvt. Ltd., was simultaneously having a 26.94% shareholding in the assessee company. We have perused the records and are unable to persuade ourselves to subscribe to the manner in which the shareholding of Mr. Jyoti Sagar in the assessee company and M/s Gayatri Films Music Pvt. Ltd. has been worked out by the A.O. As is discernible from the assessment order, the shareholding pattern of Mr. Jyoti Sagar during the year was as under: Gayatri Films Music Pvt. Ltd. Sagar Arts Pvt. Ltd. (assessee company) Name Shares % age Name Shares % age Mr. Jyoti Sagar 706 7.06 Mr. Jyoti Sagar 392 12.49 Mr. Jyoti Sagar (of Estate of Subhash Sagar, holding for Rekha Sagar Others) 1400 14 Mr. Jyoti Sagar (of Estate of Subhash Sagar, holding for Rekha Sagar Others) 453 14.45 As observed by us hereinabove, the A.O for working out the sh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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