Commissioner Of Income Tax vs. Mr. Arun Sahlot

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ITA/54/2013HC 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 the substantial questions of law. It noted that the present appeal (ITA No. 54/2013) involved identical facts and questions of law as ITA No. 56/2013, which had been decided by a common order. Consequently, the High Court disposed of the present appeal in terms of the judgment passed in ITA No. 56/2013. The operative direction was that the appeal is dismissed accordingly. No specific finding was recorded on the merits of the substantial questions of law in this judgment, as it was disposed of based on the decision in a connected appeal. The ratio decidendi would be that if an appeal is identical to another appeal decided by a common order, it will be disposed of in the same terms.

What were the facts?

The appeal was filed by the Commissioner of Income Tax, Bhopal (appellant/revenue) against Mr. Arun Sahlot (respondent/assessee). The appeal challenges an order passed by the Income Tax Appellate Tribunal (ITAT). 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 made by Raj Homes Pvt. Ltd. to the assessee and his proprietary concerns. The ITAT also directed further examination of certain aspects. The assessment years involved are 2003-04 to 2006-07. The High Court admitted the appeal on substantial questions of law. The High Court noted that the facts and questions of law in this appeal were identical to those in ITA No. 56/2013, which was decided by a common order.

What were the issues?

The High Court 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 for Assessment Years 2003-04 to 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 revenue, through its counsel, argued that the ITAT was not justified in setting aside the additions and directing further examination of irrelevant aspects for Section 2(22)(e) and in directing verification under Section 153A without it being a requirement.

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. 54/2013. 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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