SUNIL MADHYANI ,DURG vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE -1(1), BHILAI

ITA 586/RPR/2025Status: DisposedITAT Raipur20 November 2025AY 2017-2018Bench: SHRI PARTHA SARATHI CHAUDHURY (Judicial Member), SHRI ARUN KHODPIA (Accountant Member)14 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal admitted additional evidence presented by the assessee under Rule 29 of the ITAT Rules, 1963, finding them crucial for proper adjudication and their earlier non-submission due to bona fide reasons. Consequently, the Tribunal set aside the CIT(A)'s findings and remanded the matter back to the file of the CIT(A) for fresh adjudication after obtaining a remand report from the Assessing Officer.

What were the facts?

The assessee, Sunil Madhyani, a director with over 10% shareholding in M/s. Mahadeva Cars (P) Ltd., received an advance of Rs.1,12,09,000/- from the company in FY 2016-17. The company had accumulated profits of Rs.1,98,90,304/-. The Assessing Officer treated this advance as deemed dividend under Section 2(22)(e) of the Income Tax Act, and reopened the assessment under Section 147. The CIT(A) upheld the addition.

What were the issues?

Whether the advance received by the assessee from a closely held company constitutes deemed dividend u/s 2(22)(e) and the validity of reopening of assessment u/s 147; and whether additional evidences submitted by the assessee should be admitted for fresh adjudication.

Which sections of the Income-tax Act were involved?

Section 2(22)(e),Section 133A,Section 147,Section 148,Section 142(1),Section 144B,Section 250(4),Section 250(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, RAIPUR BENCH, RAIPUR

Before: SHRI PARTHA SARATHI CHAUDHURY & SHRI ARUN KHODPIA

For Appellant: Shri Rakesh Dhody, CA
For Respondent: Dr. Priyanka Patel, Sr. DR
Hearing: 20.11.2025Pronounced: 20.11.2025

PER PARTHA SARATHI CHAUDHURY, JM: The present appeal preferred by the assessee emanates from the order of the Ld.CIT(Appeals)/NFAC, Delhi dated 11.07.2025 for the assessment year 2017-18 as per the following grounds of appeal:

“1. That the learned CIT(A) has erred in law and on facts in confirming the addition of Rs.1,12,09,000/- as deemed dividend u/s.2(22)(e) of the Act, ignoring that: a) the advance was non-gratuitous, having been made in recognition of personal guarantees

The order continues below.

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