An estimated addition of 10% (Rs.48,53,306/-) to the assessee’s income was made due to lacking account books and vouchers. The Commissioner of Income Tax (Appeals) examined and deleted the addition upon the assessee’s appeal.
The Revenue appealed, contesting the additions. Simultaneously, the assessee filed a Rule 27 petition, arguing the additions lack sustainability without incriminating material post-search, and the assessment has concluded.
Regarding the deemed dividend addition, the assessee’s counsels Dr. Rakesh Gupta, Shri Deepesh Garg, and Shri Somil Agrawal argued that as the assessee is not a registered shareholder in the loan-giving company, the addition is unsustainable based on relevant court decisions. Consequently, the addition is deleted, and the Revenue’s appeal is dismissed. The assessee has filed a petition under Rule 27 of the ITAT Rules by raising the ground that these additions are not sustainable as there is no incrimination material found, as a result of the search, and the assessment attained finality.
The counsel for the Respondent Sapna Adithya argued that the Commissioner of Income Tax (Appeals) carefully reviewed facts and obtained a remand report before deleting the addition for advance payment without TDS.
The decision emphasized the Assessing Officer‘s mechanical approach, highlighting discrepancies and compliant TDS payments, leading to the conclusion that the addition under Section 40(a)(ia) of the Income Tax Act lacked merit. Relief was granted, and the addition was deleted.
After hearing both parties and reviewing the records, the two-member bench of the tribunal comprising Yogesh Kumar (Judicial) member and Shamim Yahya (accountant) member concluded that the Commissioner of Income Tax (Appeals) did not contest the proposition. The reasons presented by the Appellate Authority are deemed cogent, and we affirm them. Consequently, the Revenue’s appeal stands dismissed.
In conclusion, all three appeals filed by the Revenue were dismissed.
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