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2019 (1) TMI 987 - AT - Income TaxDeemed dividend addition u/s 2(22)(e) - assessee company has received certain amounts from M/S Euro Safety Footwear (P) Ltd., Shri Kulbir Singh is a shareholder having substantial interest in both the companies - collaboration agreement to be obtained from the Bank - proof of commercial transactions - CIT-A deleted the addition - Held that:- Assessee during the course of appellate proceedings placed on record the evidences in the form of collaboration agreement, sanction letter of bank etc. These evidences alongwith the submissions of the assessee were forwarded to the AO for comments. The AO made inquiries from the Bank and has confirmed the genuineness of the documentary evidences in the form of bank letter, collaboration agreement and bank sanction letter. Thus A.O. was given a reasonable opportunity to comment on the genuineness of the collaboration agreement and bank sanction letter. The CIT(A) specifically asked the A.O. vide letter and it was only after the receipt of remand report and after considering the same the appellate order has been passed. On the basis of the above, it is seen that the ld. CIT(A) was well justified in holding that deemed dividend can be taxed only in the hands of the recipient, either being individual shareholder, or the concern in which the individual has a substantial interest, or if any payment is made on behalf of, or for the individual benefit of the individual shareholder, which is not the case herein. - Decided against revenue
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