JAYKUMAR B.PATIL KOLHAPUR vs JOINT COMMISSIONER OF INCOME-TAX,SPL.RANGE-4, KOLHAPUR

Judgment text excerpt

Ajit Pathrikar ITXA-669-2003 (1).docx IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO. 669 OF 2003 Shri Jaykumar B. Patil (Deceased) Through L/H Shri Nitin J. Patil Kolhapur ….Appellant : Versus : Joint Commissioner of Income Tax Special Range-4, Kolhapur ….Respondent Mr. R. S. Padvekar with Mr. Tanzil Padvekar and Ms. Tejal P. Kharkar, for Assessee-Appellant. Mr. Arjun Gupta, for Revenue-Respondent. CORAM : ALOK ARADHE, CJ. & SANDEEP V. MARNE, J. DATE : 07 AUGUST 2025 JUDGMENT (Per Sandeep V. Marne, J.): 1) By this Appeal filed under the provisions of Section 260A of the Income-tax Act, 1961 (the Act), the Assessee challenges Order dated 31 March 2003 passed by the Income-Tax Appellate Tribunal, Pune Bench, Pune (ITAT) in ITA No. 49/PN/2002. The ITAT has dismissed the appeal of the Assessee and has confirmed the order of Commissioner of Income-tax (Appeals), Kolhapur [CIT(A)] who in turn had upheld the order of the Assessing Officer treating the Page No.1 of 16 7 August 2025 Ajit Pathrikar ITXA-669-2003 (1).docx advance granted to the Assessee by the company as a deemed dividend under Section 2(22)(e) of the Act and brought the same to tax. 2) The issue involved in the present appeal is whether a business advance granted by a Company to its shareholder, who does not actually utilize the said advance for execution of job work for the company can be treated as deemed dividend under Section 2(22)(e) of the Act ? 3) A brief factual background under which the appeal arises is narrated thus : The Assessee was the Managing Director and a substantial shareholder in Ghatge Patil Industries Limited (GPIL), which is company engaged in the business of manufacturing castings and other components. Tata Engineering and Locomotives C