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| The Tax Publishers2020 TaxPub(DT) 3221 (Pune-Trib) INCOME TAX ACT, 1961
Section 2(22)(e)
Where assessee contended that amount already taxed as deemed dividend in earlier assessment years was not reduced from the opening balance, by placing reliance on jurisdictional Court's decision in CIT v. P. K. Badiani, considering that double taxation, in any case, is not warranted within the spirit and soul of the Income Tax Statute, matter was remanded back to AO for reconsideration afresh.
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Dividend - Deemed dividend under section 2(22)(e) - Amount already taxed as deemed dividend in earlier assessment years was not reduced from opening balance -
Assessee challenged order of CIT(A) holding that amount already taxed as deemed dividend in earlier assessment years shall not be reduced from the opening balance of ledger balance. Assessee further contended that CIT(A) failed to appreciate fact that alternatively taxable deemed dividend ought to be compared with 50% of available reserves (since assessee was a 50% shareholder) after taking into credit of amount already taxed as deemed dividend in earlier assessment years and amount paid as interim dividend. Held: Issue needed factual verification vis-Ã -vis applicability of law as pronounced by the jurisdictional High Court in CIT v. P. K. Badiani. Double taxation, in any case, is not warranted within the spirit and soul of the Income Tax Statute. Therefore, order of CIT(A) was set aside and matter was restored back to AO directing him to consider judgment of jurisdictional High Court (supra) and analyze same with facts of the assessee's case and adjudicate issue in compliance with principles of natural justice.
Followed:CIT (Central) v. P.K. Badiani. (1970) 76 ITR 369 ( Bom.) : 1970 TaxPub(DT) 0304 (Bom-HC)
REFERRED :
FAVOUR : Matter remanded
A.Y. : 2011-12
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