The Commissioner Of Income Tax-5 v. M/S. Mukesh Kantilal Shah

ASN IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.802 OF 2011 The Commissioner of Income Tax-5.Vs. M/s. Mukesh Kantilal Shah. ...Appellant. ...Respondent. Mr. Suresh Kumar for the Appellant.None for the Respondent. CORAM : S.J.VAZIFDAR & M.S. SANKLECHA, JJ. DATE : 23[rd] July, 2012 PC: The appellant seeks to raise the following questions for Assessment Year 2004-05 for the consideration of this Court. a)Whether on the facts and in the circumstances of the case and in law the ITAT is right in dismissing the Revenue's appeal without appreciating the merits of the case, where the CIT has erred in directing income the A.O. to delete the addition of Rs.42,41,250/- deemed as divided income as per the provisions of Section 2(22)(e) of the Income Tax Act and conclusive holding by the ITAT that Section 2(22)(e) did not apply to security deposit as it is neither a loan or an advance? b)Whether on the facts and in the circumstances of the case and in law the Tribunal is correct in confirming the order of CIT(A) holding that the sum of Rs. 42,41,250/- received by the assessee from M/s. Shital Gems Pvt. Ltd. In which he is Director is not deemed divided under Section 2(22)(e) of the Income Tax Act, 1961? 2The main question is whether the deposit of Rs.42,41,250/- was as contended by the respondent assessee a security deposit for mortgaging his flat to the Bank of India to secure amounts and credit facilities granted by the Bank of India to the company M/s. Shital Gems Private Ltd.. If the respondent-assessee's case on facts is not accepted then appellant' would be entitled to succeed in view of Section 2(22)(e) of the Income Tax Act,1961. The Assessing officer has not come to the conclusion that the mortgage was not created. Both the Appellate authorities have after considering the evidence concluded that the said company had availed credit facilities from the Bank of India and that to secure the same the respondent had mortgaged his flat in favour of Bank of India. 3There is nothing on record to warrant that the finding of the Commissioner of Income Tax (Appeals) and the Tribunal are perverse. In the circumstances, we are not inclined to interfere with this finding of fact. Therefore, no substantial question of law arises and the appeal is dismissed. ( M.S. SANKLECHA, J. ) ( S. J. VAZIFDAR, J.)