PUSHP STEELS & MINING (P) LTD.,DELHI vs. ITO, WARD- 20(2), NEW DELHI

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ITA 6095/DEL/2018Status: DisposedITAT Delhi07 February 2019AY 2013-149 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the Assessing Officer and the CIT(A) failed to provide the assessee with an adequate opportunity to present its case and substantiate its claim that the advance was a trade advance. The Tribunal also noted that the CIT(A) did not conduct proper inquiry before concluding the agreement had no basis.

What were the facts?

The assessee received an advance of Rs. 2,40,16,920/- from its subsidiary company, ISPPL, pursuant to an agreement for the supply of iron ore. The Assessing Officer treated this advance as deemed dividend under Section 2(22)(e) of the Income Tax Act. The CIT(A) confirmed the addition.

What were the issues?

Whether the advance received from the subsidiary company constitutes deemed dividend, and whether the assessment order was passed beyond the limitation period.

Which sections of the Income-tax Act were involved?

Section 2(22)(e),Section 153(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCHES : F : NEW DELHI

Before: SHRI H.S. SIDHU & SHRI L.P. SAHU

advance. Copy of the assessment order passed in the case of ISPPL is placed in paper book at pages 64-67, but could not provide an opportunity to explain by issuing any show cause notice as to why such addition should not be made in the hands of the assessee. In view of above, we remit back the issue no. 1 to the file of the AO with the directions to give proper opportunity to the assessee to substantiate its claim, after considering all the documents to be filed by it including the agreement dated 30.4.2012 executed between assessee company and M/s Indian Steel & Power Pvt. Ltd. and decide the issue in dispute afresh, as per law. Since the issue on the merit is set aside to the file of the AO for fresh consideration, as aforesaid, the other issue raised vide ground no. 2 need not be adjudicated.

7.

In the result, the Appeal filed by the Assessee stands partly allowed for statistical purposes.

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