Commissioner Of Income Tax, Bhopal vs. Mr. Arun Sahlot

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ITA/51/2013HC Madhya Pradesh02 May 2017Bench: HON'BLE SHRI JUSTICE S.K. GANGELE2 pages
For Petitioner: Sanjay Lal
AI SummaryDismissed

What did the High Court hold?

The High Court considered the facts and noted that the ITAT had decided all appeals by a common order. The present appeal involved the same facts and questions of law as ITA No. 56/2013. Therefore, the present appeal was disposed of in terms of the judgment passed in ITA No. 56/2013. The High Court dismissed the appeal. The reasoning for the dismissal is that the present appeal is being disposed of in line with another appeal (ITA No. 56/2013) which was decided on the same day. The specific findings or reasoning of the ITAT on the two substantial questions of law, as well as the reasoning of the High Court for dismissing the appeal, are not detailed in this judgment, other than stating it follows the decision in ITA No. 56/2013. No issue was expressly left undecided.

What were the facts?

The appeal concerns the Commissioner of Income Tax, Bhopal (Revenue) against an order of the Income Tax Appellate Tribunal (ITAT). The assessee is Mr. Arun Sahlot. The assessment years are not explicitly stated for the entire dispute but are mentioned as 2003-04 to 2006-07 in relation to one of the issues. The ITAT had set aside additions made by the Assessing Officer (AO) under Section 2(22)(e) of the Income Tax Act, 1961, concerning payments by Raj Homes Pvt. Ltd. to the assessee and his proprietary concerns. The ITAT also directed the AO to examine aspects like commercial exigency and loan terms, and to verify if information regarding deemed dividends was found during a search, even though the AO had made additions for deemed dividends in certain assessment years. The High Court admitted the appeal on substantial questions of law.

What were the issues?

The Tribunal had to decide two substantial questions of law: 1. Whether the ITAT was justified in law in setting aside the addition under Section 2(22)(e) made by the AO on account of payments by Raj Homes Pvt. Ltd. to Shri Arun Sahlot and his proprietary concerns, with a direction to examine aspects like commercial exigency and terms of the loan, even though these aspects are not relevant under Section 2(22)(e)? 2. Whether the ITAT was justified in law in setting aside additions on account of deemed dividend in A.Ys. 2003-04 to A.Y. 2006-07 with directions to the AO to verify if information regarding deemed dividends was found during the search, even though there is no such requirement under Section 153A? Contentions: Assessee: Not recorded in the judgment. Revenue: The judgment does not explicitly record the contentions of the Revenue. However, the substantial questions of law framed indicate the Revenue's challenge to the ITAT's decision to set aside the additions made by the AO.

Which sections of the Income-tax Act were involved?

Section 2(22)(e),Section 153A

AI-generated summary — verify with the full judgment below

HIGH COURT OF MADHYA PRADESH PRINCIPAL SEAT AT JABALPUR (Division Bench: Hon'ble Shri Justice S.K. Gangele & Hon'ble Shri Justice Anurag Shrivastava) ITA No. 51/2013. Commissioner of Income Tax, Bhopal (M.P.) Versus Mr. Arun Sahlot E-3/10 Erera Colony , Bhopal (M.P.) ********** Shri Sanjay Lal, learned counsel for the appellant. Shri Sumit Nema, learned counsel for the respondent. ********** JUDGMENT (Pronounced on 02/05/2017) Per S.K. Gangele J This appeal was admitted vide order dated 17/06/2014 on the following substantial questions of law. “1. Whether on the facts and in the circumstances of the case, the ITAT was justified in law in setting aside the addition under Section 2(22)(e) made by the AO on account of payments by Raj Homes Pvt. Ltd to Shri Arun Sahlot and his proprietary concerns Arun Associates and Raj Industries, with the direction to examine such aspects as commercial exigency of the loan and terms of loan even though aspects are not relevant u/s 2(22)(e)?. 2. Whether on the facts and in the circumstances of the case, the ITAT was justified in law in setting aside the additions on account of deemed dividend in A.Ys. 2003-04 to A.Y. 2006-07 with directions to the Assessing Officer to verify if information regarding deemed dividends was found during the search even though there is no such requirement u/s 153A?.” 2. We have considered the facts in detail. The Income Tax Appellate Tribunal decided all the appeals by a common order. The facts in question of law involved in this appeal are same which were involved in ITA No. 56/2013, hence the present appeal is also disposed of in terms of the judgment passed today in ITA No. 56/2013. The appeal is dismissed accordingly. No order as to costs. 3. Office is directed to place a photocopy of the judgment passed today in ITA No. 56/2013 in the file of this appeal. (S.K. GANGELE) (ANURAG SHRIVASTAVA) JUDGE

JUDGE MISHRA

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