The Principal Commissioner Of Income Tax, (Central), Surat v. Ashadevi Mittal (

C/TAXAP/423/2019 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 423 of 2019 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE J.B.PARDIWALA andHONOURABLE MR.JUSTICE A.C. RAO ==========================================================1 Whether Reporters of Local Papers may be allowed to see the judgment ?2 To be referred to the Reporter or not ?3 Whether their Lordships wish to see the fair copy of the judgment ?4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India or any order made thereunder ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India or any order made thereunder ?========================================================== THE PRINCIPAL COMMISSIONER OF INCOME TAX, (CENTRAL), SURAT Versus ASHADEVI MITTAL (PROP. MITTAL CHEMICALS) ==========================================================Appearance: MRS MAUNA M BHATT(174) for the Appellant(s) No. 1 for the Opponent(s) No. 1 ========================================================== CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALAand HONOURABLE MR.JUSTICE A.C. RAO Date : 23/07/2019 ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE J.B.PARDIWALA) This Tax Appeal under Section 260A of the Income Tax Act, 1961, is at the instance of the Revenue and is directed against the order passed by the Income Tax Appellate Tribunal, Ahmedabd 'B' Bench, Ahmedabad, in the the IT (SS) A No.83/Ahd/2018 for the A.Y.2012-13 dated 12/12/2018. 2.The Revenue has proposed the following question of law : " Whether the Appellate Tribunal has erred in law and on facts in deleting the addition of Rs 43,12,165/- on account of dividend income received by the assessee during A.Y. 2012-13?" 3.The principal argument of the assessee before the Tribunal was that no dividend income was received during the Assessment Year 2012-2013 and, in such circumstances, there was no question for making addition of the same in the year under consideration. 4.The Tribunal took notice of the fact that the very same argument was canvassed before the CIT(A) and the CIT(A) had directed the Assessing Officer to verify, whether any dividend income was received by the assessee during year under consideration. 5.The Tribunal recorded the contention of the assessee in para 23.1, which reads as under : " Thus, before adverting the issue whether the dividend income is taxable in the year under consideration, we find pertinent to note the argument of the learned counsel for the assessee that there was no dividend income earned by the assessee in the year under consideration. If it is so, then the question of making the addition of the dividend income to the total income of the assessee does not arise. Accordingly, we are of the view that the entire exercise to adjudicate the issue whether dividend income is taxable or not will be futile int he event of no dividend income received by the assessee in the year under consideration. 6.Ultimately, the finding of fact recorded by the Tribunal is as under : "23.4 Similarly, we also find that the said dividend was received int he FY 2012-13 in the bank on 16.10.2012 as evident from the bank statement placed on page 63 of the paper book. 23.5. From the above, it is clear that the dividend income was not received by the assessee in the year ending 31.3.2012 and accordingly the same was not liable to be taxed in the year under consideration, i.e AY 2.12-13. 6.Ultimately, the finding of fact recorded by the Tribunal is as under : "23.4 Similarly, we also find that the said dividend was received int he FY 2012-13 in the bank on 16.10.2012 as evident from the bank statement placed on page 63 of the paper book. 23.5. From the above, it is clear that the dividend income was not received by the assessee in the year ending 31.3.2012 and accordingly the same was not liable to be taxed in the year under consideration, i.e AY 2.12-13. 23.6 Besides the above, we also not that the assessee has declared the dividend income pertaining the assessment year 2012-13 in the assessment year 2013-14 amounting to Rs 15,29,220.00 which was duly accepted by the Revenue. 23.7. We also note that AO has enquired the credit entries in the bank by issuing a common notice under section 142(1) wherein he asked assessee to furnish the details of entries of dividend reflecting for each year. The relevant notice under section 142(10 is placed on pages 38 to 42 of the paper book. 23.8. Further, in reply of the same notice assessee submitted details of each year dividend received. However, even in reply assessee did not submit detail of any dividend for the year ending 31st March 2012. The relevant reply of the assessee for the aforesaid notice is placed on pages 43 to 49 of paper book. Once assessed contended that she has not received any dividend for the year and submitted all the relevant details the onus was on AO to establish that assessee had received dividend income. 23.9 The controversy also arises regarding the amount determined by the AO for the dividend income in the year under consideration. In this regard we find that the AO has taken the amount of dividend i.e 43,12,165 for the year ending 31.3.2012 as recorded in the dividend warrant dated 27.9.2012 which was mentioned in Sri-Lankan currency. Thus the AO has also erred in treating the amount recorded in Sri-Lankan currency in dividend warrant as dividend income of the assessee. The copy of the dividend warrant has already been reproduced above. 24. In view of the above, we are of the view that addition made on account of dividend income for the year under consideration is on without any basis and documentary evidence. 24.1Once we have held that the assessee has not received any dividend income in the year under consideration, the other grounds of appeal raised by the assessee become academic and do not require any separate adjudication. Accordingly, we direct the AO to delete the addition. Hence the ground of appeal of the assessee is allowed. 7.In view of the findings of fact with regard to receiving of the dividend, we do not find any error, not to speak of any error of law, in the impugned order. 8.In the result, this Appeal fails and is hereby dismissed. (J. B. PARDIWALA, J) MARY VADAKKAN (A. C. RAO, J)