Mr. Jitendra Kumar Gupta, Meerut v. ACIT, Meerut

ITA 274/DEL/2016 | 2012-2013
Pronouncement Date: 29-11-2017 | Result: Allowed

Appeal Details

RSA Number 27420114 RSA 2016
Assessee PAN AARPG5507B
Bench Delhi
Appeal Number ITA 274/DEL/2016
Duration Of Justice 1 year(s) 10 month(s) 10 day(s)
Appellant Mr. Jitendra Kumar Gupta, Meerut
Respondent ACIT, Meerut
Appeal Type Income Tax Appeal
Pronouncement Date 29-11-2017
Appeal Filed By Assessee
Tags No record found
Order Result Allowed
Bench Allotted G
Tribunal Order Date 29-11-2017
Assessment Year 2012-2013
Appeal Filed On 19-01-2016
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G NEW DELHI BEFORE SHRI H.S. SIDHU JUDICIAL MEMBER AND SHRI L.P. SAHU ACCOUNTANT MEMBER I.T.A. NO. 274/DEL/2016 A.Y. : 20 1 2 - 13 JITENDRA KUMAR GUPTA 219 RAILWAY ROAD MEERUT 250002 UTTAR PADESH (PANL AARPG5507B) VS. ACIT CIRCLE-1 MEERUT (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. SUMIT GOYAL CA DEPARTMENT BY : SH. KAUSHLENDRA TIWARI SR. DR. ORDER PER H.S. SIDHU : JM ASSESSEE HAS FILED THIS APPEAL AGAINST THE IMPUGNE D ORDER DATED 17.12.2015 PASSED BY THE LD. CIT(A) MEERUT RELEVAN T TO ASSESSMENT YEAR 2012-13 ON THE FOLLOWING GROUNDS:- 1. THAT THE AUTHORITIES HAVE ERRED IN LAW AND FACT S BY ADDING AN AMOUNT OF RS. 1 67 00 000/- AS DEEMED DIVIDEND U/S. 2(22)9E) OF THE INCOME TAX ACT 1961. 2. THAT THE AUTHORITIES BELOW HAVE ERRED IN LAW AND FACTS BY TREATING ADVANCE PAYMENT OF RS. 1 67 00 000/- AG AINST SALE OF INDUSTRIAL LAND RECEIVED FROM THE COMPANY IN WHICH THE ASSESSEE IS DIRECTOR AND SHARE HOLDER AS DEEMED DIVIDEND U/S. 2(22)(E) OF THE INCOME TAX ACT 1961. 3. THAT THE AUTHORITIES BELOW HAVE ERRED IN LAW AND FACTS OF THE CASE IS NOT CONSIDERING THE VARIOUS DETAILS PL EADINGS 2 AND WRITTEN SUBMISSIONS MADE FROM TIME TO TIME DUR ING THE COURSE OF ASSESSMENT PROCEEDINGS. 4. THAT THE DEMAND OF RS. 70 81 930/- CREATED PURS UANT TO THESE ASSESSMENT WHICH ARE DISPUTED DEMAND BE KINDLY STAYED TILL THE DISPOSAL OF THE APPEAL. 5. THAT THE SEVERAL OBSERVATION AS MADE AND INFEREN CE AS DRAWN ARE UNTENABLE INCORRECT UNWARRANTED AND UNC ALLED FOR. 6. THAT THE INTEREST CHARGED U/S. 234B & 234C OF TH E INCOME TAX ACT 1961 IS ILLEGAL ON VARIOUS AND LEGA L GROUNDS. 7. THAT THE APPELLANT MAY TAKE ANY OTHER GROUND OR GROUNDS AT THE TIME OF HEARING OF APPEAL BEFORE T HE ITAT WITH THE KIND PERMISSION OF THE LD. CIT(A) MEERUT. 2. THE BRIEF FACTS OF THE CASE ARE THAT ASSESSEE FI LED RETURN OF INCOME ON 29.9.2012 DECLARING RS. 4 90 94 040/- INCOME IN IT IS AN INDIVIDUAL AND DIRECTOR/ SHARE HOLDER IN THE COMPANY IN WHICH PUB LIC ARE NOT SUBSTANTIALLY INTERESTED. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY THROUGH CASS AND STATUTORY NOTICE U/S. 14 3(2) OF THE INCOME TAX ACT 1961 DATED 23.9.2013 FIXING THE DATE OF HEARING FOR 03.10.2013 WAS ISSUED WHICH WAS SERVED UPON THE ASSESSEE. ANO THER NOTICE U/S. 142(1) ALONGWITH QUESTIONNAIRE WERE ISSUED ON 22.11 .2013. IN RESPONSE TO THE AFORESAID NOTICES THE AR OF THE ASSESSEE AT TENDED THE PROCEEDINGS FROM TIME TO TIME AND FILED THE DETAILS / REPLIED A S CALLED FOR. AO NOTED THAT ASSESSEE HAS TAKEN HUGE SUM FROM IHDP GLOBALS PRIVATE LIMITED AS PER COPY OF ACCOUNT GIVEN IN THE ASSESSMENT ORDER AND ISSUED A SHOW CAUSE FOR TREATING IT AS DEEMED DIVIDED U/S. 2(22) (E) OF THE ACT. ASSESSEE 3 CLAIMED THAT ADVANCE WAS RECEIVED AGAINST SALE OF LAND BY ASSESSEE TO COMPANY IN WHICH HE IS DIRECTOR / SUBSTANTIAL SHARE HOLDER AND COPY OF UNREGISTERED AGREEMENT WAS FILED. ASSESSEE FURTHE R STATED THAT AGREEMENT WAS TERMINATED AND COPY OF TERMINATION AGREEMENT ON PLAIN PAPER WAS ALSO FILED. THE BOARD RESOLUTION IN SUPPO RT OF HIS CLAIM WERE ALSO FILED BEFORE THE AO. AO HAD MADE THE ADDITION OF RS. 1 67 00 000/- AS DEEMED DIVIDED BY APPLYING THE PROVISION OF SECT ION 2(22)(E) OF THE ACT AND COMPLETED THE ASSESSMENT U/S. 14(3) OF THE ACT AT RS. 6 57 94 040/- AND AGRICULTURAL INCOME RS. 2 02 567/- VIDE ORDER D ATED 30.01.2015. 3. AGGRIEVED WITH THE ASSESSMENT ORDER DATED 30.1.2 015 THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A) WHO VIDE HIS IMPUGNED ORDER DATED 17.12.2015 HAS DISMISSED THE APPEAL BY CONFIR MING THE ADDITION IN DISPUTE. 4. AGAINST THE IMPUGNED ORDER DATED 17.12.2015 AS SESSEE HAS FILED THE APPEAL BEFORE THE TRIBUNAL. 5. AT THE TIME OF HEARING LD. COUNSEL OF THE ASSES SEE HAS FILED A PAPER BOOK CONTAINING PAGES 1 TO 35 CONTAINING VARIOUS DO CUMENTS HAVING THE COPY OF LEDGER A/C OF ASSESSEE IN THE BOOKS OF M/S IHDP GLOBAL (P )LTD; BREAKUP OF LEDGER A/C INTO LOAN A/C AND ADVANCE A GAINST PRORTY A/C; SCN DATED 9.1.2015; REPLY TO AO DATED 15.1.2015 OF SCN; AGREEMENT TO SALE DATED 10.5.2011; BOARD RESOLUTION DATED 10.5.2011 (FOR AGREEMENT OT SALE); TERMINATION AGREEMENT DATED 11.11.2011; BOAR D RESOLUTION DATED 11.11.2011 (FOR TERMINATION OF AGREEMENT TO SALE); PURCHASE DEEDS OF 4 PROPERTY; SUBMISSION TO CIT(A) DATED 16.7.2015; SU BMISSION TO CIT(A) DATED 27.10.2015 AND DATE WISE RUNNING LEDGER A/C O F ALL TRANSACTIONS WITH IHDP GLOBAL (P) LTD. HOWEVER WITH REGARD TO A DDITION OF RS. 1 67 00 000/- CONFIRMED BY THE LD. CIT(A) ON AC COUNT OF THE DEEMED DIVIDEND THE ASSESSEES COUNSEL HAS STATED THAT DURING THE YEAR THE COMPANY GAVE RS. 1 67 00 000/- TO THE ASSESSEE. IT IS NOT IN THE NATURE OF ADVANCE OR LOAN WITHIN THE MEANING OF SECTION 2 (22)(E) OF THE ACT. HOWEVER IT IS AN ADVANCE GIVEN BY THE COMPANY TO T HE ASSESSEE AGAINST PURCHASE OF PROPERTY BEING INDUSTRIAL LAND AT KHAS RA NO. 84/1 & 100/1 VILLAGE RETHANI MEERUT MEASURING 4185 SQ.MTRS. BU T THE SAID AGREEMENT GOT TERMINATED VIDE TERMINATION AGREEMENT DATED 11 .11.2011 AND THE NATURE OF SAID PAYMENTS ARE NOT SIMPLICITOR LOAN OR ADVANCE BUT IT IS A TRADE ADVANCE FOR BUSINESS PURPOSES WHICH IS OUTSI DE THE PURVIEW OF SECTIO0N 2(22)(E) OF THE ACT. TO SUPPORT HIS CONTEN TION HE RELIED UPON THE CBDT CIRCULAR NO. 19/2017 DATED 12.6.2017 RELATING TO SETTLED VIEW ON SECTION 2(22)(E) OF THE INCOME TAX ACT TRADE ADVAN CES REG. AND ALSO RELIED UPON THE CASE LAW SUNIL SETHI (2009) 26 SOT 95 (DEL). 6. ON THE CONTRARY LD. DR RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW AND FILED THE WRITTEN SUBMISSIONS CITING THER EIN THE VARIOUS CASE LAWS. THE CASE LAWS CITED BY THE LD. DR IN THE WRIT TEN SUBMISSIONS ARE REPRODUCED HEREUNDER :- SUB: WRITTEN SUBMISSION IN THE ABOVE CASE- REG. 5 IN THE ABOVE CASE ASSESSE CLAIM THAT THE TRANSACTI ON ARE COMMERCIAL IN NATURE SO COVERED BY THE BOARD CIRCULAR IS NOT ACCEPTABLE AS CIT APPEAL HAS DISCUS SED THE NATURE OF TRANSACTION IN DETAIL AND FOUND IT NO T COMMERCIAL IN NATURE .IT IS ALSO HUMBLY SUBMITTED T HAT THE FOLLOWING DECISIONS MAY KINDLY BE CONSIDERED WI TH REGARD TO DEEMED DIVIDEND' U/S 2(22)(E) OF 1.T.ACT: 1. MISS P. SARADA VS CIT [96 TAXMAN 11! 229 ITR 444. 144 CTR 209] (WHERE HON'BLE SUPREME COURT HELD THAT ADVANCES MADE BY COMPANY TO ASSESSEE WOULD HAVE TO BE TREATED AS DEEMED DIVIDENDS PAID ON DATE S WHEN WITHDRAWALS WERE ALLOWED TO BE MADE AND SUBSEQUENT ADJUSTMENT OF ACCOUNT MADE ON VERY LAST DAY OF ACCOUNTING YEAR WOULD NOT ALTER POSITION THA T ASSESSEE RECEIVED NOTIONAL DIVIDENDS ON VARIOUS DAT ES. CIT VS MISS P. SARADA [21 TAXMAN 94) WHERE HON'BLE MADRAS HIGH COURT HELD THAT AMOUNT OF IMPUGNED EXCESS WITHDRAWALS EVEN THOUGH ADJUSTED AGAINST CREDIT BALANCE BEFORE CLOSE OF YEAR WAS ASSESSABLE AS DEEMED DIVIDEND IN ASSESSEE'S HANDS I N TERMS OF SECTION 2(22)(E) 2. GOPAL AND SONS (HUF) VS CIT [2017] 77 TAXMANN.COM 71 (SC)/[2017) 245 TAXMAN 48 (SC)/[2017] 391 ITR 1 (SC)/[2017] 291 CTR 321 (SC) WHERE HON'BLE SUPREME COURT HELD THAT EVEN IF HUF I S NOT A REGISTERED SHAREHOLDER IN LENDING COMPANY ADVANCESLLOANS RECEIVED BY HUF IS TAXABLE AS DEEMED DIVIDEND UNDER SECTION 2(22)(E). IF KARTA-SHAREHOLDER HAS SUBSTANTIAL INTEREST IN HU F. 6 3. CIT VS MUKUNDRAY K. SHAH [2007] 160 TAXMAN 276 (SC)/{2007] 290 ITR 433 (SC)/[2007] 209 CTR 97 (SC) A SEARCH CONDUCTED AT ASSESSEE'S PREMISES LED TO SEIZURE OF A DIARY WHICH CONTAINED PURCHASING OF N INE PER CENT RBI RELIEF BONDS BY ASSESSEE FROM FUNDS RECEIVED FROM TWO FIRMS 'B' AND 'C' IN WHICH HE WAS A PARTNER. TRIBUNAL' AFTER EXAMINATION OF CASH FLOW STATEMENT HELD THAT TWO FIRMS WERE USED AS CONDUITS BY ASSESSEE; THAT 'A' HAD MADE PAYMENTS TO 'B' AND 'C' FOR BENEFIT OF ASSESSEE WHICH ENABLED HIM TO BUY NINE PER CENT RBI RELIEF BONDS AND UPHELD FINDING OF ASSESSI NG OFFICER. UPHELD ADDITION U/S 2(22(E) OF I.T. ACT. 4. PUNEET BHAGAT V. ITO (157 ITD 353) WHERE HON'BLE ITAT DELHI HELD THAT DEEMED DIVIDEND- LOANS AND ADVANCES TO SHARE HOLDERS-LOANS RECEIVED BY THE COMPANY WOULD BE TREATED AS DEEMED DIVIDEND IN HANDS OF P AND S IN PROPORTION TO THEIRSHAREHOLDING S. 5. ADDL CIT VS SHRI CHANDRAKANT V GOSALIA [2015- TIOL-1187-ITAT-MUM] WHERE HON'BLE ITAT DELHI HELD THAT MERE REPAYMENT O F MONEY BORROWED BY THE SHAREHOLDER WILL NOT ESCAPE H IM FROM THE PROVISIONS OF SECTION 2(22)(E) AND THUS IT CAN BE TREATED AS DEEMED DIVIDEND. 6. SUNIL KAPOOR VS CIL [2015]63 TAXMANN.COM 97 (MADRAS)/[2015] 235 TAXMAN 279 (MADRAS) WHERE HON'BLE MADRAS HIGH COURT HELD THAT WHERE ASSESSEE HOLDING 60 PER CENT SHARES OF A COMPANY TOOK PERSONAL LOAN FROM ACCUMULATED SURPLUS OF SAID 7 COMPANY SAID AMOUNT WOULD BE TREATED AS DEEMED DIVIDEND UNDER SECTION 2(22)(E) AFTER REDUCING THEREFROM AMOUNT REPAID BY ASSESSEE DURING YEAR 7. SHASHI PAL AGARWAL VS CIT [2015] 54 TAXMANN.COM 289 (ALLAHABAD)/[2015] 229 TAXMAN 307 (ALLAHABAD)/[2015] 370 ITR 720 (ALLAH ABAD) WHERE HON'BLE ALLAHABAD HIGH COURT HELD THAT WHERE LENDING OF MONEY WAS NOT PART OF BUSINESS OF LENDIN G COMPANIES LOAN/ADVANCE GIVEN TO ASSESSEE-SHAREHOLD ER WOULD BE TREATED AS DEEMED DIVIDEND UNDER SECTION 2(22)(E) 8. STAR CHEMICALS (P.) LTD VS CIT [72 TAXMAN 279 203 ITR 11 114 CTR 185] WHERE HON'BLE BOMBAY HIGH COURT HELD THAT PROVISION S OF SECTION 2(22)(E) WOULD APPLY TO A COMPANY WHICH HAD TAKEN LOAN FROM ITS SUBSIDIARY 9. CIT V SUNIL CHOPRA [2011] 12 TAXMANN.COM 496 (DELHI)/[2011] 201 TAXMAN 316 (DELHI)/[2011] 242 CT R 498 (DELHI) TRIBUNAL DELETED ADDITION ACCEPTING ASSESSEE'S CONTENTION THAT SAID ADVANCES WERE RECEIVED AGAINST SALE OF PROPERTY UNDER TERMS OF AGREEMENT DATED 18- 9- 2003 AND THEREFORE MONEY WAS TAKEN BY ASSESSEE IN LINE OF HIS BUSINESS OF REAL ESTATE. HON'BLE DELHI HIGH COURT HELD THAT THERE WAS GREAT PERVERSITY AND INFI RMITY IN FINDINGS AND OBSERVATIONS' OF TRIBUNAL AND THER EFORE IMPUGNED ORDER WAS TO BE SET ASIDE. 10. M. AMARESWARA RAO V. DY.CIL [157 ITD 657/13~ DTR 153/178 TTJ 700] 8 WHERE HON'BLE ITAT VISHAKHAPATNAM HELD THAT DEEMED DIVIDEND-LOAN-BENEFICIAL OWNERSHIP OF MORE THAN 10 PER CENT SHARES IN A CLOSELY HELD COMPANY- ASSESSABLE A S DEEMED DIVIDEND. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ECORDS ESPECIALLY THE IMPUGNED ORDER WRITTEN SUBMISSIONS FILED BY B OTH THE PARTIES AS WELL AS THE PAPER BOOK FILED BY THE ASSESSEES COUNSEL CONTAINING COPY OF LEDGER A/C OF ASSESSEE IN THE BOOKS OF M/S IHDP GLO BAL (P )LTD; BREAKUP OF LEDGER A/C INTO LOAN A/C AND ADVANCE AGAINST PROR TY A/C; SCN DATED 9.1.2015; REPLY TO AO DATED 15.1.2015 OF SCN; AGREE MENT TO SALE DATED 10.5.2011; BOARD RESOLUTION DATED 10.5.2011 (FOR AGREEMENT OT SALE); TERMINATION AGREEMENT DATED 11.11.2011; BOARD RESOL UTION DATED 11.11.2011 (FOR TERMINATION OF AGREEMENT TO SALE); PURCHASE DEEDS OF PROPERTY; SUBMISSION TO CIT(A) DATED 16.7.2015; SU BMISSION TO CIT(A) DATED 27.10.2015 AND DATE WISE RUNNING LEDGER A/C O F ALL TRANSACTIONS WITH IHDP GLOBAL (P) LTD. WE FIND THAT IN THIS CAS E ASSESSEE IS A SHARE HOLDER OF MORE THAN 10% SHARES IN IHDP GLOBALS (P) LTD. AND DURING THE YEAR THE COMPANY GAVE FUNDS TOTALING RS. 1 67 00 0 00/- TO THE ASSESSEE WHICH HAS BEEN ADDED BY THE AO U/S. 2(22)(E) OF THE ACT AND LATER THE LD. CIT(A) CONFIRMED THE FINDINGS OF AO. WE FURTHER NOT E THAT DURING THE YEAR THE COMPANY GAVE RS. 1 67 00 000/- TO THE ASSESSEE . IN MY OPINION IT IS NOT IN THE NATURE OF ADVANCE OR LOAN WITHIN THE MEA NING OF SECTION 2(22)(E) OF THE ACT. HOWEVER IT IS AN ADVANCE GIV EN BY THE COMPANY TO THE ASSESSEE AGAINST PURCHASE OF PROPERTY BEING IN DUSTRIAL LAND AT KHASRA NO. 84/1 & 100/1 VILLAGE RETHANI MEERUT MEASURIN G 4185 SQ.MTRS. 9 WHICH IS EVIDENT FROM PAGE NO. 13-27 OF PB A COPY O F PURCHASE DEED SHOWING OWNERSHIP OF PROTY TO ASSESSEE PAGE NO 10 OF PB COPY OF BOARD RESOLUTION DATED 10.5.2011 BY THE COMPANY PAGE NO. 7 TO 9 OF PB A COPY OF AGREEMENT TO SALE DATED 10.5.2011. BUT THE SAID AGREEMENT GOT TERMINATED VIDE TERMINATION AGREEMENT DATED 11.11.2 011 AND THE NATURE OF SAID PAYMENTS ARE NOT SIMPLICITOR LOAN OR ADVANC E BUT IT IS A TRADE ADVANCE FOR BUSINESS PURPOSES WHICH IS OUTSIDE THE PURVIEW OF SECTION 2(22)(E) OF THE ACT. WE FURTHER NOTE THAT IN THIS CASE THE POSITION WAS RATHER REVERSE I.E. THE ASSESSEE BEING A DIRECTOR A ND SHARE HOLDER OF THE COMPANY WAS PROVIDING FREQUENT ADVANCES TO THE COM PANY FOR ITS BUSINESS REQUIREMENTS AND THE COMPANY WAS HAVING CR EDIT BALANCE OF THE ASSESSEE IN ITS BOOKS THE OP. CR. BAL. IN THIS YEA R WAS RS.7 82 149/- & THE CL. CR. BAL. WAS RS.2 37 47 149/- (PAGE NO. 1 OF PB ). THE ASSESSEE NEVER CHARGED ANY INTEREST FROM THE COMPANY. THE CO. IN I TS BOOKS OPENED THE CONSOLIDATE LEDGER A/C. OF ASSESSEE FOR LOAN TAKEN AND FOR ADVANCE GIVEN AGAINST PURCHASE OF PROPERTY HOWEVER DURING PROCEE DINGS BIFURCATED LOAN A/C AND ADVANCE AGAINST PROPERTY ALC WAS FURN ISHED (PAGE NO. 2 PB). THUS IT IS A CASE OF ADVANCE GIVEN FOR PURCHASE OF PROPERTY. IT IS ALSO NOTED THAT THE PURCHASE AGREEMENT NOT BEING REGISTE RED CANNOT BE A REASON FOR NOT ACCEPTING THE CONTENTS OF THE AGREEM ENT WHEN IT IS WITNESSED BY TWO PERSONS ALSO (PAGE NO. 7-9 OF PB). IN OUR OPINION THE EFFECT OF NON REGISTRATION AT THE MOST CAN BE ONL Y TO THE EXTENT THAT IT MAY EFFECT ITS ENFORCEABILITY IN THE COURT OF LAW B UT THE CONTENTS OF AGREEMENT CANNOT BE DENIED IN THE ABSENCE OF REGIST RATION. IN THIS CASE 10 THE REGISTRATION WAS NOT CONSIDERED NECESSARY SINCE THERE WAS NO DOUBT OF ANY DISPUTE AT A LATER STAGE BETWEEN THE PARTIES. S IMILARLY TERMINATION AGREEMENT BEING UNREGISTERED CANNOT BE A REASON FOR DOUBTING ITS CONTENTS WHEN IT IS ALSO WITNESSED BY TWO PERSONS. (PAGE NO. 11 OF PB). THE ONLY EFFECT OF NON REGISTRATION CAN BE THE DOU BTFULNESS OF ITS LEGAL ENFORCEABILITY BUT NON REGISTRATION CANNOT DENY THE CONTENTS. THE OBSERVATION OF CIT (A) THAT THE AGREEMENT IS DT.1O. 05.11 WHICH MENTIONS ADVANCE PAYMENT OF RS.14 00 000/- VIDE CHEQUE DT.12 .05.11 IS NOT POSSIBLE. THIS OBSERVATION WAS UNFOUNDED SINCE POST DATED CHEQUE WAS ISSUED AT THE TIME OF EXECUTION OF AGREEMENT. HENCE THE ADDITION IN DISPUTE MADE BY THE AO AND CONFIRMED BY THE LD. CI T(A) IS UNTENABLE AND THEREFORE WE DELETE THE SAME. OUR AFORESAID VIEW I S FORTIFIED BY THE CBDT CIRCULAR NO. 19/2017 DATED 12.6.2017 RELATING TO SE TTLED VIEW ON SECTION 2(22)(E) OF THE INCOME TAX ACT TRADE ADVANCES RE G. WHEREIN IT IS STIPULATED THAT TRADE ADVANCES WHICH ARE IN THE NA TURE OF COMMERCIAL TRANSACTIONS WOULD NOT FALL WITHIN THE AMBIT OF TH E WORD ADVANCE IN SECTION 2(22)(E) OF THE ACT. WE FURTHER FIND FORCE FROM THE DECISION IN THE CASE OF SUNIL SETHI (2009) 26 SOT 95 (DEL) WHEREIN ON SIMILAR AND IDENTICAL FACTS AND CIRCUMSTANCES IT WAS HELD THAT DEEMED DIVIDEND AY 2004-05 ASSESSEE WAS A DIRECTOR OF A COMPANY HOLD ING 50% OF ITS SHARE CAPITAL IN COURSE OF ASSESSMENT PROCEEDING S AO FOUND THAT ASSESSEE HAD RECEIVED A SUM DURING RELEVANT PREVIO US YEAR FROM SAID COMPANY ASSESSEE EXPLAINED THAT SAID AMOUNT WAS R ECEIVED TO PURCHASE A SUITABLE BUSINESS PREMISES BUT AS DEAL C OULD NOT BE FINALIZED 11 HE RETURNED SAID AMOUNT TO COMPANY AO REJECTED SA ID EXPLANATION AND ADDED AMOUNT SO RECEIVED TO ASSESSEES INCOME BY IN VOKING PROVISIONS OF SECTION 2(22)(E) WHETHER SINCE AMOUNT WAS GIVEN F OR BUSINESS PURPOSES AND ASSESSEE COULD VALIDITY PERFORM SUCH ACT ON BEHALF OF COMPANY IN ACCORDANCE WITH AUTHORITY HELD BY HIM TH ROUGH RESOLUTION OF BOARD OF DIRECTORS OF COMPANY AMOUNT IN QUESTION C OULD NOT BE CONSIDERED AS DEEMED DIVIDEND. HOWEVER AFTER PERUS ING THE CASE LAWS CITED BY THE LD. DR WE FIND THAT THE SAME ARE ON D ISTINGUISHED FACTS HENCE ARE NOT APPLICABLE IN THE PRESENT CASE. 8 IN THE BACKGROUND OF THE AFORESAID DISCUSSIONS AN D RESPECTFULLY FOLLOWING THE PRECEDENT AS AFORESAID WE DELETE T HE ADDITION IN DISPUTE AND ALLOW THE GROUND RAISED BY THE ASSESSEE. 9 . IN THE RESULT THE APPEAL OF THE IS ALLOWED. ORDER PRONOUNCED ON 29/11/2017. SD/- SD/- [L.P. SAHU] [H.S. SIDHU] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 29/11/2017 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR ITAT ASSISTANT REGISTRAR ITAT DELHI BENCHES