IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD "D" BENCH AHMADABAD
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Before Shri D.K.Tyagi, Judicial Member and
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Shri Anil Chaturvedi, Accountant Member
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ITA No. 2662/Ahd/2012
Assessm ent Year :2007-08
ACIT, Cirlce-4, V/s . M/s.Shripad Concrete Pvt.
Room No. 223, Aayakar Bhavan, Ltd, Office Floor, Ashoka
Surat Pavilion, Opp: Kapadia
Health Club, New Civil
Road, Surat
PAN No. AAICS7708Q
(Appellant) .. (Respondent)
/ By Appellant Shri K. C. Mathews, Sr.D.R.
× /By Respondent None
/Date of Hearing 15.04.2014
/Date of Pronouncement 24.04.2014
ORDER
PER : Shri D.K. Tyagi, Judicial Member
This is the appeal filed by the revenue against the order of Ld.
CIT(A)-IV, Surat dated. 04-06-2010.
2. Revenue has taken following effective ground:-
"1. On the facts and in the circumstances of the case and in Law,
the Ld. CIT(A)-IV, Surat has erred in deleting the addition of Rs.
952573/- made by the AO u/s. 2(22)(2) of the Act."
IT A No . 2 66 2 /A h d/ 1 0 A. Y . 0 7- 0 8
A CIT v s. M / s. S hr i pad Co n cr et e P v t Lt d Page 2
3. Brief facts of the case are that during the course of assessment
proceedings AO observed that assessee had obtained the loans of Rs.
38,81,000/- from Sripad ConchemPvt Ltd, a sister company wherein Shri
Shirish Shah, Director was having not less than 10% share holding. He
was also having not less than 20% share holding with the assessee
company. This amount was therefore considered by AO for addition u/s.
2(22)(e) of the Act. Under the similar circumstances, the deemed dividend
of Rs. 35,50,000/- was also taxed during the assessment year of 2006-07.
During the current year, as the accumulated reserves of Shripad Concrete
Pvt Ltd stood at Rs. 45,02,573/-, the addition of Rs. 9,52,573/- was made
after giving credit for amount taxed in assessment year 2006-07. Ld.
CIT(A) deleted this addition by following his order for assessment year
2006-07 in which addition made under similar circumstances was deleted
by him. The order of Ld. CIT(A) for assessment year 2006-07 has been
upheld by Hon'ble ITAT vide its order dated 28/08/2012 by observing as
under:-
"6. We have perused the orders of the authorities below and gone
through the cases relied upon by the appellant. The Id. A.O. attracted
the provisions of Section 2(22)(e) of the IT Act on loan of Rs,
35,50,000/- but the appellant has established that these are business
transactions. The appellant sold goods of Rs.12,15,513/- to M/s.
Shripat Conchem P. Ltd. and Rs. 35, 75,975/- to M/s. Shripat
Construction division of M/s. Shripat Conchem P. Ltd. There were two
accounts maintained by the appellant, one for financial transaction and
another for business transaction. The loan amount was partly re-paid
during the year. If both the accounts are taken together, there is liability
on the assessee but it was for business necessity of the appellant. It is
not a loan as envisaged in Section 2(22)(e) of the IT Act. We
respectfully follow the findings given by the Co-ordinate Bench as
discussed above as are squarely applicable on the assessee's case.
There is no merit in the department's appeal. Accordingly, the same is
dismissed."
IT A No . 2 66 2 /A h d/ 1 0 A. Y . 0 7- 0 8
A CIT v s. M / s. S hr i pad Co n cr et e P v t Lt d Page 3
In view of the above, the order passed by Ld. CIT(A) for the year under
consideration is also upheld.
4. In the result, revenue's appeal is dismissed.
This Order pronounced in open Court on 24.04.2014
Sd/ Sd/-
(Anil Chaturvedi) (D.K.Tyagi)
Accountant Member Judicial Member
a.k.
/ Copy of Order Forwarded to:-
1. / Appellant
2. × / Respondent
3. / Concerned CIT
4. - / CIT (A)
5. , , / DR, ITAT, Ahmedabad
6. [ / Guard file.
By order/ ,
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