CIT v. Mukundray K. Shah

290 ITR 433Supreme Court of India2007#1126 most cited

What is CIT v. Mukundray K. Shah authority for?

For Section 2(22)(e) to apply, a payment by a company must be in the nature of a loan or advance, and the company must have accumulated profits. Such payments to a concern in which a shareholder, holding more than 10% voting power, has a substantial interest are deemed dividends if the shareholder ultimately benefits, even if routed through different modes or concerns.

99

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2007 to 2025.

Also referred to as

CIT v. Mukundray K. Shah · Mukundray K. Shah 290 ITR 433 · section 2(22)(e) deemed dividend · accumulated profits · closely held company payments · loan or advance under section 2(22)(e) · shareholder substantial interest · funds routed through conduit company · deemed dividend shareholder benefit · payment to concern shareholder interest · definition of dividend section 2(22) · closely held company deemed dividend

Also reported as

209 CTR 97

Sections most often in play

Section 1961Section 2(22)(e)Section 153ASection 132Section 143(3)Section 115-OSection 115QSection 147
Read the full judgment

Issues it is cited on

section 115qsection 133(a)section 153b(1)(a)time barred assessmentsection 148(1)accumulated profitssection 153(1)(a)closely held companybona fide mistakesection 158bcsection 2(22)section 90a

Judgments citing CIT v. Mukundray K. Shah

Sudhir Dhingra, New Delhi vs. DCIT, Central Circle-II, Gurgaon

In the result, appeal of the revenue is dismissed

ITA 5721/DEL/2018[2014-15]Status: DisposedITAT Delhi13 Jan 2022AY 2014-15

Bench: Sh. Amit Shukla, Judicialmember & Sh.B. R. R. Kumar

Section 132Section 139Section 147Section 153ASection 158BSection 2(22)(e)

…atements of Sh. Akshay Dhanda and Sh. Ajay Nagpal recorded on 22.06.2015 and 07.07.2015. (ii) Whether on the facts and in the circumstances of the case the Ld. CIT(A) failed to appreciate that the Hon'ble Supreme Court in the case of CIT v. Mukundray K. Shah, 290 ITR 433 under identical circumstances has upheld the addition of deemed dividend u/s 2(22)(e) made by the AO in a block assessment u/s 158BC, the provisions of which are restrictive than those of section 153A. (iii) Whether on the facts and in the circumstances of the case the Ld. CIT(A) was right in concluding that there was a difference in scope of pr…

Anoop Thatai, New Delhi vs. DCIT, Central Circle-II, Gurgaon

In the result, appeal of the revenue is dismissed

ITA 5719/DEL/2018[2014-15]Status: DisposedITAT Delhi13 Jan 2022AY 2014-15

Bench: Sh. Amit Shukla, Judicialmember & Sh.B. R. R. Kumar

Section 132Section 139Section 147Section 153ASection 158BSection 2(22)(e)

…atements of Sh. Akshay Dhanda and Sh. Ajay Nagpal recorded on 22.06.2015 and 07.07.2015. (ii) Whether on the facts and in the circumstances of the case the Ld. CIT(A) failed to appreciate that the Hon'ble Supreme Court in the case of CIT v. Mukundray K. Shah, 290 ITR 433 under identical circumstances has upheld the addition of deemed dividend u/s 2(22)(e) made by the AO in a block assessment u/s 158BC, the provisions of which are restrictive than those of section 153A. (iii) Whether on the facts and in the circumstances of the case the Ld. CIT(A) was right in concluding that there was a difference in scope of pr…

Parminder Singh Kalra, New Delhi vs. ACIT, Central Circle-14, New Delhi

ITA 6702/DEL/2017[2007-08]Status: DisposedITAT Delhi15 Jun 2021AY 2007-08

Bench: Sh. Amit Shukla

For Appellant: Sh. Ved Jain, AdvFor Respondent: Ms. Sushma Singh, CIT DR
Section 143(2)Section 153A

…Hon'ble Supreme Court has held that “confessional statements” made before Customs Officer though retracted within six days is an admission and binding since Custom Officers are not Police Officers. g) CIT VsMukundray K. Shah [2007] 160 Taxman 276 (SC)/[2007] 290 ITR 433 (SC)/[2007] 209 CTR 97 (SC) A search conducted at assessee’s premises led to seizure of a diary, which contained purchasing of nine per cent RBI relief bonds by assessee from funds received from two firms ‘B’ and ‘C’ in which he was a partner. Tribunal after examination of cash flow statement held that two firms were used as conduits by assessee…

Parminder Singh Kalra, New Delhi vs. ACIT, Central Circle-14, New Delhi

ITA 6701/DEL/2017[2006-07]Status: DisposedITAT Delhi15 Jun 2021AY 2006-07

Bench: Sh. Amit Shukla

For Appellant: Sh. Ved Jain, AdvFor Respondent: Ms. Sushma Singh, CIT DR
Section 143(2)Section 153A

…Hon'ble Supreme Court has held that “confessional statements” made before Customs Officer though retracted within six days is an admission and binding since Custom Officers are not Police Officers. g) CIT VsMukundray K. Shah [2007] 160 Taxman 276 (SC)/[2007] 290 ITR 433 (SC)/[2007] 209 CTR 97 (SC) A search conducted at assessee’s premises led to seizure of a diary, which contained purchasing of nine per cent RBI relief bonds by assessee from funds received from two firms ‘B’ and ‘C’ in which he was a partner. Tribunal after examination of cash flow statement held that two firms were used as conduits by assessee…

ACIT, New Delhi vs. Sh. Parminder Singh Kalra, New Delhi

ITA 5334/DEL/2016[2011-12]Status: DisposedITAT Delhi15 Jun 2021AY 2011-12

Bench: Sh. Amit Shukla

For Appellant: Sh. Ved Jain, AdvFor Respondent: Ms. Sushma Singh, CIT DR
Section 143(2)Section 153A

…Hon'ble Supreme Court has held that “confessional statements” made before Customs Officer though retracted within six days is an admission and binding since Custom Officers are not Police Officers. g) CIT VsMukundray K. Shah [2007] 160 Taxman 276 (SC)/[2007] 290 ITR 433 (SC)/[2007] 209 CTR 97 (SC) A search conducted at assessee’s premises led to seizure of a diary, which contained purchasing of nine per cent RBI relief bonds by assessee from funds received from two firms ‘B’ and ‘C’ in which he was a partner. Tribunal after examination of cash flow statement held that two firms were used as conduits by assessee…

ACIT, New Delhi vs. Sh. Parminder Singh Kalra, New Delhi

ITA 5333/DEL/2016[2010-11]Status: DisposedITAT Delhi15 Jun 2021AY 2010-11

Bench: Sh. Amit Shukla

For Appellant: Sh. Ved Jain, AdvFor Respondent: Ms. Sushma Singh, CIT DR
Section 143(2)Section 153A

…Hon'ble Supreme Court has held that “confessional statements” made before Customs Officer though retracted within six days is an admission and binding since Custom Officers are not Police Officers. g) CIT VsMukundray K. Shah [2007] 160 Taxman 276 (SC)/[2007] 290 ITR 433 (SC)/[2007] 209 CTR 97 (SC) A search conducted at assessee’s premises led to seizure of a diary, which contained purchasing of nine per cent RBI relief bonds by assessee from funds received from two firms ‘B’ and ‘C’ in which he was a partner. Tribunal after examination of cash flow statement held that two firms were used as conduits by assessee…

ACIT, New Delhi vs. Sh. Parminder Singh Kalra, New Delhi

ITA 5332/DEL/2016[2009-10]Status: DisposedITAT Delhi15 Jun 2021AY 2009-10

Bench: Sh. Amit Shukla

For Appellant: Sh. Ved Jain, AdvFor Respondent: Ms. Sushma Singh, CIT DR
Section 143(2)Section 153A

…Hon'ble Supreme Court has held that “confessional statements” made before Customs Officer though retracted within six days is an admission and binding since Custom Officers are not Police Officers. g) CIT VsMukundray K. Shah [2007] 160 Taxman 276 (SC)/[2007] 290 ITR 433 (SC)/[2007] 209 CTR 97 (SC) A search conducted at assessee’s premises led to seizure of a diary, which contained purchasing of nine per cent RBI relief bonds by assessee from funds received from two firms ‘B’ and ‘C’ in which he was a partner. Tribunal after examination of cash flow statement held that two firms were used as conduits by assessee…

ACIT, New Delhi vs. Sh. Parminder Singh Kalra, New Delhi

ITA 5330/DEL/2016[2007-08]Status: DisposedITAT Delhi15 Jun 2021AY 2007-08

Bench: Sh. Amit Shukla

For Appellant: Sh. Ved Jain, AdvFor Respondent: Ms. Sushma Singh, CIT DR
Section 143(2)Section 153A

…Hon'ble Supreme Court has held that “confessional statements” made before Customs Officer though retracted within six days is an admission and binding since Custom Officers are not Police Officers. g) CIT VsMukundray K. Shah [2007] 160 Taxman 276 (SC)/[2007] 290 ITR 433 (SC)/[2007] 209 CTR 97 (SC) A search conducted at assessee’s premises led to seizure of a diary, which contained purchasing of nine per cent RBI relief bonds by assessee from funds received from two firms ‘B’ and ‘C’ in which he was a partner. Tribunal after examination of cash flow statement held that two firms were used as conduits by assessee…

Paraminder Singh Kalra, New Delhi vs. ACIT, New Delhi

ITA 4576/DEL/2016[2007-08]Status: DisposedITAT Delhi15 Jun 2021AY 2007-08

Bench: Sh. Amit Shukla

For Appellant: Sh. Ved Jain, AdvFor Respondent: Ms. Sushma Singh, CIT DR
Section 143(2)Section 153A

…Hon'ble Supreme Court has held that “confessional statements” made before Customs Officer though retracted within six days is an admission and binding since Custom Officers are not Police Officers. g) CIT VsMukundray K. Shah [2007] 160 Taxman 276 (SC)/[2007] 290 ITR 433 (SC)/[2007] 209 CTR 97 (SC) A search conducted at assessee’s premises led to seizure of a diary, which contained purchasing of nine per cent RBI relief bonds by assessee from funds received from two firms ‘B’ and ‘C’ in which he was a partner. Tribunal after examination of cash flow statement held that two firms were used as conduits by assessee…

Paraminder Singh Kalra, New Delhi vs. ACIT, New Delhi

ITA 4575/DEL/2016[2006-07]Status: DisposedITAT Delhi15 Jun 2021AY 2006-07

Bench: Sh. Amit Shukla

For Appellant: Sh. Ved Jain, AdvFor Respondent: Ms. Sushma Singh, CIT DR
Section 143(2)Section 153A

…Hon'ble Supreme Court has held that “confessional statements” made before Customs Officer though retracted within six days is an admission and binding since Custom Officers are not Police Officers. g) CIT VsMukundray K. Shah [2007] 160 Taxman 276 (SC)/[2007] 290 ITR 433 (SC)/[2007] 209 CTR 97 (SC) A search conducted at assessee’s premises led to seizure of a diary, which contained purchasing of nine per cent RBI relief bonds by assessee from funds received from two firms ‘B’ and ‘C’ in which he was a partner. Tribunal after examination of cash flow statement held that two firms were used as conduits by assessee…

Smt Jamuna Vernekar vs. The Deputy Commissioner of Income Tax

In the result, the impugned order of the tribunal dated

ITA/43/2013HC Karnataka10 Feb 2021

Bench: ALOK ARADHE,R. NATARAJ

Section 143(1)Section 143(2)Section 2(22)(e)Section 260

…e Tax (Appeals) regarding the accumulated profits. In support of aforesaid submission, reliance has been placed on the decision in 'VIJAY KUMAR TALWAR Vs. COMMISSIONER OF INCOME-TAX' 330 ITR 1 AND 'COMMISSIONER OF INCOME TAX Vs. MUKUNDRAY K SHAH' (2007) 290 ITR 433. 6. We have considered the submissions made on both sides and have perused the record. The only issue, which arises for consideration in this appeal is whether 10 loan or advance given to a shareholder can be treated as deemed dividend under Section 2(22)(e) of the Act, which reads as under: any payment by a company, not being a company…

DCIT, Central Circle- 19, New Delhi vs. Amq Agro India Pvt. Ltd., New Delhi

In the result, the appeals filed by the Revenue for A

ITA 4287/DEL/2018[2008-09]Status: DisposedITAT Delhi29 May 2020AY 2008-09

Bench: Shri R.K. Panda & Shri K.Narasimha

For Appellant: Shri Hiren Mehta, CAFor Respondent: Ms Pramita M. Biswas, CIT, DR
Section 10ASection 132(1)Section 153ASection 245D(4)

…awla (supra) does not apply in the present case as in the case of Kabul Chawla, addition made had no connection with any material evidence/statement found/recorded. 23.2 Referring to the decision of the Hon’ble Supreme Court in the case of Mukundray K. Shah, 290 ITR 433, she submitted that the Hon’ble Supreme Court in the said decision has held that even if the addition arises out of enquiry related to source of investment, if details of such undisclosed investment is found during the course of search, addition has to be sustained. 23.3 Referring to the decision of the Hon’ble Delhi High Court in the case of CI…

Amq Agro India Pvt. Ltd., New Delhi vs. ACIT, Central Circle- 19, New Delhi

In the result, the appeals filed by the Revenue for A

ITA 2801/DEL/2018[2008-09]Status: DisposedITAT Delhi29 May 2020AY 2008-09

Bench: Shri R.K. Panda & Shri K.Narasimha

For Appellant: Shri Hiren Mehta, CAFor Respondent: Ms Pramita M. Biswas, CIT, DR
Section 10ASection 132(1)Section 153ASection 245D(4)

…awla (supra) does not apply in the present case as in the case of Kabul Chawla, addition made had no connection with any material evidence/statement found/recorded. 23.2 Referring to the decision of the Hon’ble Supreme Court in the case of Mukundray K. Shah, 290 ITR 433, she submitted that the Hon’ble Supreme Court in the said decision has held that even if the addition arises out of enquiry related to source of investment, if details of such undisclosed investment is found during the course of search, addition has to be sustained. 23.3 Referring to the decision of the Hon’ble Delhi High Court in the case of CI…

Amq Agro India Pvt. Ltd., New Delhi vs. ACIT, Central Circle- 19, New Delhi

In the result, the appeals filed by the Revenue for A

ITA 169/DEL/2018[2011-12]Status: DisposedITAT Delhi29 May 2020AY 2011-12

Bench: Shri R.K. Panda & Shri K.Narasimha

For Appellant: Shri Hiren Mehta, CAFor Respondent: Ms Pramita M. Biswas, CIT, DR
Section 10ASection 132(1)Section 153ASection 245D(4)

…awla (supra) does not apply in the present case as in the case of Kabul Chawla, addition made had no connection with any material evidence/statement found/recorded. 23.2 Referring to the decision of the Hon’ble Supreme Court in the case of Mukundray K. Shah, 290 ITR 433, she submitted that the Hon’ble Supreme Court in the said decision has held that even if the addition arises out of enquiry related to source of investment, if details of such undisclosed investment is found during the course of search, addition has to be sustained. 23.3 Referring to the decision of the Hon’ble Delhi High Court in the case of CI…

Jagjit Singh, Punjab vs. ACIT, New Delhi

ITA 1097/DEL/2015[2011-12]Status: DisposedITAT Delhi01 Oct 2019AY 2011-12

Bench: Shri R.K. Panda & Shri Kuldip Singh

For Appellant: Shri Satish Aggarwal, AdvocateFor Respondent: Shri J.K. Mishra, CIT DR
Section 142Section 143Section 153ASection 153CSection 68

…1 u/s 132 (4) of the Act and statement of the assessee u/s 131 on 15.02.2012 contended that the detailed investigation resulted into addition made by the AO and relied upon the decision rendered by Hon’ble Supreme in case of CIT vs. Mukundray K. Shan (2007) 290 ITR 433 (SC). But we are of the considered view that when the assessment or reassessment, as the case may be, has been made u/s 153C, the necessary requirements to proceed with such initiation of assessment proceedings must be fulfilled. But, in the instant case, as discussed in the preceding paras, the AO has failed to record the satisfaction note as…

Jagjit Singh, Punjab vs. ACIT, New Delhi

ITA 1098/DEL/2015[2012-13]Status: DisposedITAT Delhi01 Oct 2019AY 2012-13

Bench: Shri R.K. Panda & Shri Kuldip Singh

For Appellant: Shri Satish Aggarwal, AdvocateFor Respondent: Shri J.K. Mishra, CIT DR
Section 142Section 143Section 153ASection 153CSection 68

…1 u/s 132 (4) of the Act and statement of the assessee u/s 131 on 15.02.2012 contended that the detailed investigation resulted into addition made by the AO and relied upon the decision rendered by Hon’ble Supreme in case of CIT vs. Mukundray K. Shan (2007) 290 ITR 433 (SC). But we are of the considered view that when the assessment or reassessment, as the case may be, has been made u/s 153C, the necessary requirements to proceed with such initiation of assessment proceedings must be fulfilled. But, in the instant case, as discussed in the preceding paras, the AO has failed to record the satisfaction note as…

Jagjit Singh, Punjab vs. ACIT, New Delhi

ITA 1096/DEL/2015[2010-11]Status: DisposedITAT Delhi01 Oct 2019AY 2010-11

Bench: Shri R.K. Panda & Shri Kuldip Singh

For Appellant: Shri Satish Aggarwal, AdvocateFor Respondent: Shri J.K. Mishra, CIT DR
Section 142Section 143Section 153ASection 153CSection 68

…1 u/s 132 (4) of the Act and statement of the assessee u/s 131 on 15.02.2012 contended that the detailed investigation resulted into addition made by the AO and relied upon the decision rendered by Hon’ble Supreme in case of CIT vs. Mukundray K. Shan (2007) 290 ITR 433 (SC). But we are of the considered view that when the assessment or reassessment, as the case may be, has been made u/s 153C, the necessary requirements to proceed with such initiation of assessment proceedings must be fulfilled. But, in the instant case, as discussed in the preceding paras, the AO has failed to record the satisfaction note as…

Jagjit Singh, Punjab vs. ACIT, New Delhi

ITA 1095/DEL/2015[2009-10]Status: DisposedITAT Delhi01 Oct 2019AY 2009-10

Bench: Shri R.K. Panda & Shri Kuldip Singh

For Appellant: Shri Satish Aggarwal, AdvocateFor Respondent: Shri J.K. Mishra, CIT DR
Section 142Section 143Section 153ASection 153CSection 68

…1 u/s 132 (4) of the Act and statement of the assessee u/s 131 on 15.02.2012 contended that the detailed investigation resulted into addition made by the AO and relied upon the decision rendered by Hon’ble Supreme in case of CIT vs. Mukundray K. Shan (2007) 290 ITR 433 (SC). But we are of the considered view that when the assessment or reassessment, as the case may be, has been made u/s 153C, the necessary requirements to proceed with such initiation of assessment proceedings must be fulfilled. But, in the instant case, as discussed in the preceding paras, the AO has failed to record the satisfaction note as…

M/S G G Oils & Fats Pvt.Ltd, Bathinda vs. Deputy Commissioner of Income Tax, Bathinda

In the result, the assessee’s appeal is dismissed

ITA 508/ASR/2017[2014-15]Status: DisposedITAT Amritsar05 Jul 2019AY 2014-15

Bench: Sh. Sanjay Arora & Sh. N. K. Choudhryi. T. A. No. 508/Asr/2017 Assessment Year: 2014-15

For Appellant: Sh. P. N. Arora &For Respondent: Sh. Charan Dass (D.R.)
Section 143(3)Section 2(18)Section 2(22)(e)Section 56

…oked. Similar view, it was submitted, was expressed by the Hon'ble Calcutta High Court in CIT v. Gayatri Chakraborty [2018] 407 ITR 730 (Cal), rendered after considering the decisions by the Apex Court in Sarda (P.) (supra) and CIT v. Mukundray K. Shah [2007] 290 ITR 433 (SC). The decisions in Tarulata Shyam (supra) and Sarda (P.), it was argued, are distinguishable inasmuch as there were no mutual benefits and obligations in the facts of the said cases. In both these cases there were only one-way transactions during the year, i.e., payment 4 G. G. Oils & Fats Pvt. Ltd. v. Dy. CIT by the payer-company to the as…

Mrs. Reena Jain, Mumbai vs. Deputy Commissioner of Income Tax Central Circle - 8(4), Mumbai

In the result, the appeals are partly allowed

ITA 1007/MUM/2018[2014-15]Status: DisposedITAT Mumbai25 Mar 2019AY 2014-15

Bench: Shri Pawan Singh () & Shri N.K. Pradhan () Assessment Year: 2009-10 & Assessment Year: 2010-11 & Assessment Year: 2011-12 & Assessment Year: 2013-14 Mr. Ratnesh Chand Jain, Deputy Commissioner Of 902/903, A Wing, Kalinga Vs. Income Tax, Central Tower, Nirmal Nagar, Circle-8(4), 658, 6Th Link Road, Mulund (West), Floor, Aayakar Bhavan Mumbai-400080 Mumbai. Pan No. Aabpj0683P Appellant Respondent Assessment Year: 2009-10 & Assessment Year: 2010-11 & Assessment Year: 2014-15 Mrs. Reenajain, Deputy Commissioner Of 902/903, A Wing, Kalinga Vs. Income Tax Central Tower, Nirmal Nagar Link Circle-8(4), 658, 6Th Road, Mulund (West), Floor, Aayakar Bhavan Mumbai-400080 Mumbai. Pan No. Aeapj6605C

For Appellant: Mr. Bhupendra Shah, ARFor Respondent: Mr. A.K. Srivastava, DR
Section 131Section 132Section 132(4)Section 143(3)Section 153ASection 271(1)(c)Section 68

…nd Nahta v. CIT (2008) 301 ITR 134 (MP) and CIT v. S. Khader Khan Son (2008) 300 ITR 157 (Madras). 10. On the other hand, the Ld. DR supports the order passed by the Ld. CIT(A). Also reliance is placed by him on the decision in CIT v. Mukundray K. Shah (2007) 290 ITR 433 (SC) and CIT v. Harjeev Aggarwal (2016) 70 taxmann.com 95 (Delhi). The Ld. DR further submits that in the case of Pr. CIT v. Best Infrastructure (India) (P.) Ltd. (2018) 94 taxmann.com 115 (SC), the Hon’ble Supreme Court has granted SLP against the impugned order of the High Court that (i) section 68 addition was not called for on the basis of st…