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These two appeals under Section 260A of the Income Tax Act, 1961 (Act, for short) have been filed by Atma Ram Properties Private Limited, the appellant and relate to assessment years 1999-00 and 2000-01. For the said years, the appellant had filed returns of income on 10th December, 1999 and 30th November, 2000 declaring income of Rs.49,85,970/- and Rs.39,87,710/-, respectively. Return for the assessment year 1999-2000 was taken up for scrutiny and the total income was assessed at Rs.1,11,76,124/-. Return for the assessment year 2000-2001 was not taken up for scrutiny and was processed and the returned income as declared was not enhanced/modified.

3. The Assessing Officer thereupon initiated reassessment proceedings recording identical reasons for the two assessment years in question. The relevant portion of the reasons read as under:-

" Appeal order in the case of M/s Atma Ram Properties Pvt. Ltd. for A.Y. 2001-02 was passed by the Ld. CIT(A) vide order No.206/03-04 dated 28.06.2004 wherein addition of Rs.1,56,51,570/- on account deemed dividend u/s 2(22)(e) of the I.T. Act, 1961 was restricted to Rs.19,51,725/-. The Ld. CIT(A) held that addition to the extent of Rs.1,36,99,845/- was to be made in earlier years. On perusal of record it was found that the advance for M/s Atma Ram Builders Pvt. Ltd. was received by the assessee in various assessment years as per following details:-

Assessment year 1999-2000. (ITA No. 87/2010)

8. In the assessment year 1999-00, the undisputed position is that the appellant had answered queries raised by the Assessing Officer vide letter dated 8th February, 2002. The said letter reads as under:-

"Dated 08 Feb, 2002 The assessing Officer, Circle 2(1), CR Building, IP estate New Delhi.
Sub:-Atma Ram Properties (P) Limited, Assessment Year 1999-2000 Completion of assessment Sir, In continuation of our discussion with you, copies of sister concerns mentioned below are enclosed:
Creditors:
Indian cine cosmos Pvt. Rs.45,50,585.65 Limited Kulvinder Distributors P Rs.9,13,582.49 Ltd. 
        Mrs. Poonam Sawhney                 Rs.1,39,480.21

        Ashwin & Co. Pvt Limited            Rs.7,83,350.00

        Sadoon    Builders        P         Rs.1,43,473.83
        Limited
        Smt. Sadhna Chadha                  Rs.12,17,630.99

        M/s AR Chadha & Co. (I)             Rs.47,41,429.50
        P Ltd.
        Atma Ram Builders Pvt.              Rs.77,00,182.66
        Limited
        Atma Ram Construction               Rs.87,323.77
        P limited


         Debtors:

        Mrs Archana mamgain            Rs.54,29,342.52

        ARSD Endowment trust           Rs.14,690.00

        ARC Cement Ltd.                Rs.27,98,461.76

        AR Chadha                      Rs.14,26,761.62

        AR Chadha & Co.                Rs.75,04,916.62

        Atma Ram Trust                 Rs.7,44,592.37

        Mr. CM Chadha                  Rs.24,11,088.69

        Smt. Chuniwati Chadha          Rs.16,42,963.63

        Smt. Kamlesh Sawhney           Rs.11,73,376.87



        Yours faithfully,
        For Atma Ram Properties P limited

        (C M Chadha)
        (Director)"