Case Law Details
Aditya Jyot Eye Hospital Pvt. Ltd. Vs ITO (ITAT Mumbai)
The assessee purchased the flat bearing flat no.602, in the building namely Ornate Galaxy, located at L.T. Road, Dadar (E), Mumbai. No doubt, the assessee Dr. Natarajan is the CMD of hospital and is having 99% share of the assessee company. The flat is near to the hospital which facilitate the treatment of eye patient at any time. Even in the case of emergency the CMD can approach to the hospital promptly. In the instant case, the assessee did not transfer the fund to its director. The assessee took the bank loan to the tune of Rs.300 lacs and by adding some more funds, purchased the flat bearing no.602, in the building namely Ornate Galaxy, located at L.T. Road, Dadar (E), Mumbai. It is purely the wish of the AO in which he desired that the Dr. S. Natarajan was having the flat at Wadala, therefore, the assessee company should not purchase the flat for CMD of the assessee company. The transaction is nowhere in contravention of the provision of any income tax act. The provision of Section 2(22)(e) of the Act is not applicable to the facts of the case. Moreover, there may be tax planning on the part of the assessee company but there is no violation of any provision of the Income Tax Act. The claim of the assessee is not liable to be declined.
FULL TEXT OF THE ITAT JUDGMENT
The assessee has filed the present appeal against the order dated 13.08.2015 passed by the Commissioner of Income Tax (Appeals)-12, Mumbai [hereinafter referred to as the “CIT(A)”] relevant to the AY. 2010-11.
2. The assessee has raised the following grounds: –
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