SMS TOLLS AND DEVELOPERS,NAGPUR vs. ITO, WARD 1(5), NAGPUR

ITA 348/NAG/2023Status: DisposedITAT Nagpur18 November 2024AY 2011-12Bench: SHRI V. DURGA RAO (Judicial Member)14 pages
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What did the Tribunal hold?

The Tribunal held that current year profits should not be included in accumulated profits for the purpose of Section 2(22)(e). The addition was restricted to the actual accumulated profits available on the date of the advance.

What were the facts?

The assessee company received an Inter Corporate Deposit (ICD) from a related company. The Assessing Officer treated a portion of this ICD as deemed dividend under Section 2(22)(e) of the Income Tax Act, including current year profits in the calculation of accumulated profits.

What were the issues?

Whether current year profits should be considered as accumulated profits for determining deemed dividend under Section 2(22)(e) and the applicability of Section 2(22)(e) to Inter Corporate Deposits.

Which sections of the Income-tax Act were involved?

Section 2(22)(e),Section 148,Section 143(3),Section 147

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Income Tax Appellate Tribunal, NAGPUR BENCH, NAGPUR

Before: SHRI V. DURGA RAO & SHRI K.M. ROY, ACCOUNTANT, MEMBER

For Appellant: Shri Kapil Hirani
For Respondent: Shri Abhay Y. Marathe

PER K.M. ROY, A.M.

The present appeal has been filed by the assessee challenging the impugned order dated 14/06/2023, passed by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, [“learned CIT(A)”], for the assessment year 2011–12. 2. The assessee has raised following grounds:–

“1. On the facts and circumstances of the case and in law, the learned CIT Appeals, NFAC, Delhi has grossly erred in confirming reopening of assessment by issue of notice u/s 148 of IT Act and subsequent assessment order passed u/s 143(3) r.w.s. 147 of the Act.

2 SMS Tolls and Developers Ltd.

2.

On the facts and circumstances of the case and in law, the

The order continues below.

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