DCIT, NEW DELHI vs. SH. MONI KUMAR SUBBA, NEW DELHI

Since, the appeals relate to the same assessee, having common issues, were heard together, so, these are being disposed off by this consolidated order for the sake of convenience and brevity.

At the first instance, we will deal with the appeal in 2010-11. Following grounds have been raised in this appeal:

On the facts and in the circumstances of the case, the CIT (A) has erred in law and on facts in deleting addition of Rs. 6,60,000/- to the ALV of the house property situated at 87-A, Adhichini, New Delhi without considering the facts that the addition was made by the AO after conducting adequate local enquiries.

In his rival submissions, the ld. Sr. DR although supported the orders of the authorities below but could not controvert the aforesaid contention of the ld. Counsel for the assessee.

We have considered the submissions of both the parties and perused the material available on the record. It is noticed that an identical issue having similar facts was a subject matter of the assessee’s appeal in for the assessment year 2009-10 wherein vide order dated 29.06.2016, the relevant findings have been given in para 10 which read as under: “10. We have carefully considered the rival contentions and also perused the decisions of lower authorities. According to the facts recorded by the lower authorities the assessee has received a sum of Rs. 11.23 Lacs from the company in which his minor son holds 67.14% shareholding. According to the provisions of section 2 (22) (e) of the income tax act dividend includes any payment by a company, not being a company in which the public are substantially interested, of any sum (whether as representing a part of the assets of the company or otherwise) made after the 31st day of May, 1987, by way of advance or loan to a shareholder, being a person who is the beneficial owner of shares (not being shares entitled to a fixed rate of dividend whether with or without a right to participate in profits) holding not less than ten per cent of the voting power. Therefore according to the provisions of the law the assessee must be the 4 & 3728/Del/2015 DLF Utilities Ltd. beneficial owner of the shares of 10% or more. In this case ld AO has not established whether the assessee is holding shares as the beneficial shareholder of 10% or more. We do not find any such finding in the assessment order. Merely because the shares are held by the minor son of the assessee and the loan is received by the assessee it cannot be established that assessee is the beneficial shareholder of 10% or more and therefore such loan amount is not chargeable to tax in the hands of the assessee. Furthermore the submission of the assessee before the lower authorities that it is in the nature of advance rent as whenever the rent is payable by the company to the assessee same is deductible from this amount therefore it partakes the character of advance rent. The Ld. AO has also not categorically stated that this amount is not advance rent and not adjusted subsequently against the rent payable by the company to the assessee. According to us if it is an advance rent then it becomes a business transaction and the provisions of deemed dividend cannot apply to such transactions. In view of this we reverse the finding of lower authorities in confirming an addition of Rs. 11.23 Lacs on account of advance rent received by the assessee from the Suba Microsystems private limited. In the result ground No. 2 of the appeal of the assessee is allowed.” So, respectfully following the aforesaid referred to order dated 29.06.2016 in assessee’s own case, the issue under consideration is decided in assessee’s favour.

In for the assessment year 2011-12, the issues involved are similar having identical facts as were in 2010-11, the only

In the result, the appeals of the department are dismissed. (Order Pronounced in the Court on 17/09/2018)