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Facts
The assessee filed three appeals against orders related to Assessment Years 2011-12, 2012-13, and 2013-14, concerning additions made under Section 2(22)(e) of the Income Tax Act. The appeals arose from proceedings under Section 147/143(3). The assessee was proceeded against ex-parte as no one appeared on his behalf.
Held
The Tribunal held that the facts were identical to a previous case where a similar addition was confirmed. However, upon considering the assessee's evidence showing the impugned sum as commercial sale/purchase transactions, the Tribunal rejected the Revenue's stand. The Tribunal accepted the assessee's appeal.
Key Issues
Whether the addition of amounts as deemed dividends under Section 2(22)(e) of the Income Tax Act is justified when the assessee presents evidence of commercial transactions.
Sections Cited
147, 143(3), 148, 2(22)(e)
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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI
Before: Sh. Satbeer Singh Godara
Asstt. Year : 2012-13 Gaurav Bajaj, Vs Income Tax Officer, 1786, 1st Floor, Bajaj House, Ward-22(3), Bhagirath Palace, New Delhi-110002 New Delhi-110006 (APPELLANT) (RESPONDENT) PAN No. AEOPB3197D Assessee by: None Revenue by : Sh. Akhilesh Kumar Yadav, Sr. DR Date of Hearing: 02.06.2025 Date of Pronouncement: 02.06.2025 ORDER These assessee’s three appeals 3474 & 3475/Del/2019, for Assessment Years 2011-12, 2012-13 and 2013-14, arise against the CIT(A)-8, New Delhi’s as many orders dated 05.02.2019, 06.02.2019 and 18.03.2019 in case Nos. 10589, 10590 & 10591, in proceedings u/s 147/143(3) of the Income Tax Act, 1961 (in short “the Act”), respectively.
Cases called twice. None appears at the assessee’s behest. He is accordingly proceeded ex-parte.
Learned departmental representative vehemently argues during the course of hearing that both the lower authorities have rightly invoked section 148/147 reopening mechanism against the assessee in order to assess section 2(22)(e)
3474 & 3475/Del/2019 Gaurav Bajaj deemed dividends amount of Rs.15,00,000/-, in his hands, in the course of assessment framed on 08.12.2016 and partly upheld in the CIT(A)’s discussion as under:
4.2 The first ground relates to the addition of Rs.15,40,000/- u/s 2(22)(e) of the Act. The facts of this case of the appellant are identical to the facts in the case of appellant himself in A.Y. 2011- 12, whereby vide appellate order dated 05.02.2019, in Appeal No. 10589/16-17, the addition of Rs.13,64,000/- has been confirmed u/s 2(22)(e) of the I.T. Act. Considering the totality of facts and circumstances stated above, therefore, the addition of Rs.15,40,000/- made by the AO is also hereby confirmed u/s 2(22)(e) of the I.T. Act.
I have given my thoughtful consideration to the assessee’s pleadings all along and the department’s vehement contentions supporting the impugned deemed dividends addition. There could be hardly any dispute that the assessee has duly filed his evidence representing the impugned sum as in the nature of commercial sale/purchase transactions between M/s Anand Lighting Co. and M/s Sanskriti Villas Pvt. Ltd. That being the case, I hereby reject the department’s stand treating the same as non-genuine transactions to delete the impugned section 2(22)(e) deemed addition in light of CIT Vs. Creative Dying and Printing (P) Ltd. (2009) 318 ITR 476 (Del.). Ordered accordingly. The assessee’s instant first and forest appeal is hereby accepted in very terms.
3474 & 3475/Del/2019 Gaurav Bajaj 5. Same order to follow in the assessee’s remaining twin appeals & 3475/Del/2019 for Assessment Years 2012-13 and 2013-14 since raising the very issue of section 2(22)(e) deemed dividend addition, in very terms.