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2014 (1) TMI 1241 - AT - Income TaxIncome from sale of land - Income from business or capital gains - Held that:- The sum was received by the assessee on account of sale of small portion of 0.18 Bigas of land, which was earlier sold in the financial year 2000-01 - The entire land was sold in such earlier year and the amount of gain resulting from such transfer was declared and accepted as ‘Capital gains' - Now the income from sale of smaller portion of land cannot be said to be income from business - Decided against Revenue. Disallowance of prior period expenses - Held that:- The payment made to the party on 19.01.2006 was simply in the nature of advance for which the services were rendered and the bill was raised in the previous year relevant to the assessment year under consideration - Since the assessee is a company following mercantile system of account, the expenditure would call for deduction at the time when the liability is finally settled and not when the amount was paid in advance - The reason for deduction of tax at source at the time of payment is the applicability of provisions of section 194J which provide for deduction of tax at source either at the time of credit of the sum to the account of the payee or at the time of payment there of, whichever is earlier - Decided against Revenue. Deemed dividend u/s 2(22)(e) - Held that:- The assessee company is not a shareholder in the companies advancing loans to it - The shareholders of the assessee are shareholders of such companies - There is no question of assessing deemed dividend in the hands of the assessee - Following CIT vs. Navyug Promoters (P) Ltd. [2011 (11) TMI 318 - Delhi High Court] - An assessee who is not a shareholder of the company, from which he received a loan or an advance cannot be treated as being covered by the definition of the word "dividend" as provided in s. 2(22)(e) - Decided against Revenue.
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