POONAM MOHTA,KOLKATA vs. ACIT, CENTRAL CIR 1(1), KOLKATA

Brief facts of the case are that a search and seizure operation u/s 132(1) of the Act was conducted in the case of assessee followed by notices issued u/s 142(1) and 143(2) of the Act. In response to the notices, assessee submitted detailed explanation in compliance to the notices issued by the AO. The ld. AO after considering the submission of the assessee various disallowances were made and assessed the income of the assessee as under:

Dissatisfied with the above order, assessee preferred an appeal where the appeal of the assessee was dismissed.

Aggrieved by the above order, assessee is in appeal before the Tribunal raising various grounds.

In ground no. 1, the appeal of the assessee is in general in nature therefore, need not required to be adjudicated.

In ground no. 2, the assessee stated that ld. CIT(A) while passing the impugned order was not justified by upholding the action of ld. AO by disallowing of Rs. 3,33,509/- u/s 14A of the Act is not correct which is not in accordance with law in terms of Rule 8D of the I.T. Rules. In this regard, the ld. AR submitted before the bench that by sustaining the view taken by the AO by disallowing of Rs. 3,33,509/- u/s 14A is not correct. Therefore, the addition made in the hands of assessee is liable to be deleted.

On the other hand, ld. DR supported the order passed by the authorities below and oppose the prayer made by the AR of the assessee.

We after hearing the rival submission of the parties and perusing the record placed before us. We notice that assessee has its own fund to earn exempt during the year from the balance sheet placed before us. After considering the submission of the parties and examining the facts of the case we restrict the disallowance of expenditure to the extent of Rs. 74,946/- in the hands of assessee and partly allow the grounds taken by the assessee.

In ground no. 3, the assessee has challenged the order of ld. CIT(A) by upholding the action of ld. AO in making the addition of Rs. 5,39,576/- on account of alleged deemed dividend u/s 2(22)(e) of the Act which is in applicable in the case of assessee. On this issue, the ld. AR submitted that assessee has paid sufficient interest to the company namely M/s. Surajmal Mohta & Co. Pvt. Ltd. by placing confirmation of accounts from the

We after hearing the rival submission of the parties and perusing the records as well as documents placed before us find that the provisions of section 2(22)(e) of the Act does not attract in the case of present assessee since the assessee has paid sufficient interest to the company. Accordingly, the addition made in the hands of assessee is hereby deleted and ground taken by the assessee is hereby allowed.

In ground no. 4, the assessee has stated that the ld. AO while calculating the income of assessee deduction under Chapter VIA of the Act amounting to Rs. 1,50,000/- u/s 80C and u/s 80D of Rs. 15,000/- of the Act did not take into consideration and even the ld. CIT(A) also not considered the above facts therefore, the claim of the assessee may be allowed by the Tribunal. On this context, the ld. AR submitted that computation of income statement to show before us that assessee is eligible for deduction u/s 80C of the Act amounting to Rs. 1,50,000/- and u/s 80D of Rs. 15,000/- of the Act.

We after considering the submission of the parties and perusing the document placed before us by the assessee find that the claim of the assessee is correct and accordingly deduction u/s 80C amounting to Rs. 1,50,000/- and u/s 80D of Rs.

In ground no. 5, the contention of the assessee is that ld. CIT(A) was not justified to ignore the double addition of Rs. 50 lakhs made by the ld. AO while computing the total income of the assessee and added this amount once under the income from other sources and again separately as disclosure while computation of income which is not correct and accordingly ld. CIT(A) ought to be deleted made by the AO. The ld. AR submitted before the bench that the alleged addition of Rs. 50 lakhs made in the hands of assessee by the AO twice under the head of income from other sources and again it was added separately while computation part therefore such double addition is not proper and in order to examine the issue it may necessary be remand back to the issue to the file of AO.

On the other hand, ld. DR has not raised any objection on such prayer made by the AR of the assessee. We after hearing both the parties and considering the prayer made by the assessee remand back the issue to the file of AO to examine the instant issue afresh and if it is double addition then necessary correction would be made accordingly by calculating the correct income of the assessee. Accordingly, the instant issue is allowed for statistical purposes.

In the result, the appeal of the assessee is partly allowed for statistical purposes.