ORDER SHEET GA NO.3647 OF 2015 WITH ITAT NO.170 OF 2015 AND GA NO.412 OF 2017 WITH ITAT No.9 OF 2017 IN HIGH COURT AT CALCUTTA SPECIAL JURISDICTION(INCOME-TAX) ORIGINAL SIDE PRINCIPAL COMMISSIONER OF INCOME TAX-3,KOLKATA Versus EAST END SILKS PRIVATE LIMITED BEFORE: Hon'ble JUSTICE ANIRUDDHA BOSE Hon'ble JUSTICE ARINDAM SINHA Date : 13th November, 2017. MR.ANIMESH KANTI GHOSAL, SR.ADVOCATE, MR.S.MUKHERJEE, ADVOCATE FOR APPELLANT MR.J.P.KHAITAN,SR.ADVOCATE, MS.SWAPNA DAS, MR.S.DAS, MR.S.SARKAR, ADVOCATES FOR RESPONDENT Court : appeal registered as ITAT No.170 of 2015 is against decision of Income Tax Appellate Tribunal, Kolkata Bench C Kolkata dated 10th March, 2015 for assessment year 2005-06 upholding assessee s stand that sum of Rs.3,49,44,070/- ought 2 not to be added to its income for taxing purpose. Assessing Officer had found that assessee had received said sum as interest free loan from another corporate entity, M/s. Pataka Industries (P) Ltd. and both assessee and said Pataka Industries (P) Ltd had individual as common shareholder, holding 24% shares in latter and 23.8% in assessee. On this factual background, assessing officer held that aforesaid sum was to be treated as deemed dividend in hands of assessee and taxed accordingly. In other appeal, registered as ITAT No.9 of 2017 pertaining to same assessee for assessment year 2010-11, assessing officer has taken same stand in situation involving same two corporate entities and individual. assessee was successful before Commissioner of Income Tax (Appeal) in respect of both assessment years. CIT (A) as first appellate authority found in favour of assessee on basis of decision of Tribunal itself in ITA No.533/Kol/2011. Mr. Ghosal, learned Senior Counsel appearing for Revenue sought to sustain order of assessing officer and prayed for admission of appeal on following suggested questions : I] Whether having regard to facts and circumstances admittedly assessee company and Pataka Industries Limited had one common share holder i.e. Mr. Abul Kalam and he was holding 20% shares in M/s. Pataka Industries Private Ltd. ( more than 10% ) and he was holding 23.8% (i.e. more than 20%) shares in assessee 3 company, therefore condition laid down in second limb of section 2(22)(e) are fulfilled which has been totally overlooked by CIT(A) and also by ITAT and as such entire finding is perverse and not tenable in law ? II] Whether on facts and in circumstances of case and in law ld. Tribunal had erred in concurring with decision of CIT(A) and thereby differing with view of assessing officer in holding that section 2(22)(e) of Income Tax Act, 1961 is not applicable to case of respondent assessee for AY 2005-06? III] Whether on facts and in circumstances of case and in law ld. ITAT was not justified in upholding decision of CIT(A) in deleting addition of sum made under section 2(22)(e) of Income Tax Act, 1961 on account of deemed dividend in view of fact that loans were taken from M/s. Pataka Industries (P) Limited by respondent assessee where there is one common shareholder having more than 20% of shareholdings and satisfying condition stipulated in second limb of section 2(22)(e) of Income Tax Act? IV] Whether decision of Tribunal is perverse and otherwise unsustainable in eye of law ? Mr. Ghosal s submission is that assessee s case squarely comes within ambit of deemed dividend as specified in section 2(22)(e) of Income Tax Act, 1961. Argument of Mr. Khaitan, learned Senior Counsel appearing for assessee is that point is covered in 4 favour of assessee and no substantial question of law is involved in this appeal. He has drawn our attention to unreported decision of Coordinate Bench of this Court in assessee s own case, decided on 21st August, 2014 in ITAT No. 122 of 2014. This judgment was delivered relying upon earlier decision of this Court in case of CIT Vs. M/s. Baljit Securities Pvt. Ltd. (ITAT No.74 of 2013) decided on 24th June, 2013. This Court has followed that authority in case of Principal Commissioner of Income Tax-3, Kolkata Vs. Rungta Properties (P.) Ltd. reported in 2017[249] Taxman 18. point suggested by Revenue for admission, we find, is squarely covered by aforesaid authorities in favour of assessee. Hon ble Supreme Court of India has also found this issue in favour of assessee in unreported judgement relied on by Mr. Khaitan in case of C.I.T., Delhi-II Vs. Madhur Housing and Development Company (in Civil Appeal No.3961 of 2013) decided on 5th October, 2017. We do not find any substantial question of law to be involved in these appeals. appeals and stay petitions are accordingly dismissed, without any order as to costs. (ANIRUDDHA BOSE, J.) (ARINDAM SINHA, J.) sb Principal Commissioner of Income-tax-3, Kolkata v. East End Silks Private Limited