Case Law Details
ACIT Vs Sanjay Passi (ITAT Delhi)
We are of the considered view that Ld. CIT(A) has rightly observed that AO has wrongly made the addition u/s. 2(22)(e) by holding that there are accumulated profits in the hands of M/s Robin Software Pvt. Ltd. Ld. CIT(A) has also noticed that the AO has completed the assessment of M/s Robin Software Pvt. Ltd. for assessment year 2012-13 and no addition has been made in the hands of that company and return of loss has been accepted. Therefore, the Ld. CIT(A) has rightly cancelled the order of the AO by holding that if the AO has accepted the income returned by the said company and not made any changes in the return of income and assessed the income as declared by the said company, he cannot hold that there was accumulated profits for the purpose of section 2(22)(e) of the Act. We further note that Ld. CIT(A) has observed that assessment of M/s Robin Software Pvt. Ltd has been completed vide order of the same Assessing Officer on 26.3.2014 and AO has accepted the returned of loss Rs. 1,05,460/- as on 28.3.2012 of that company. This being so the same AO could not have adopted a different income / profit figure to make addition u/s 2(22)(e). Hence, Ld. CIT(A) noted that when AO assesses the income of M/s Robin Software Pvt. Ltd. as loss for the same financial year, there could be no ground available to hold that the said company had accumulated profits at the time of making loans/advances. Therefore, the addition made as deemed dividend u/s. 2(22)(e) of Rs. 13,88,23,000/- was rightly deleted by the Ld. CIT(A) for want of fulfillment of the required conditions stipulated under the said section, which does not need any interference on our part, hence, we uphold the action of the Ld. CIT(A) and reject the ground raised by the Revenue. Since there was want of fulfillment of the required conditions stipulated under the said section, as aforesaid, the case laws cited from both the sides are not applicable here. As a result, the Revenue’s appeal is dismissed.
FULL TEXT OF THE ITAT JUDGMENT
Revenue has filed this appeal and Assessee has filed the Cross Objection which emanate from the order dated 22.12.2014 for A.Y. 2012-13 of the Ld. CIT(A).
2. The Revenue has raised the following grounds:-
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