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2014 (1) TMI 1547 - AT - Income TaxDeletion made u/s 2(22)(e) of the Act –Trade advances treated as deemed dividend - Held that:- The trade advances do not fall within the ambit of section 2(22)(e) of the Act as the business transactions are outside the purview of section 2(22)(e) of the Act - The word "advance" which appears in the company of the word "loan" could only mean such advance which carries with it an obligation of repayment - Trade advance which are in the nature of money transacted to give effect to commercial transaction would not fall within the ambit of the provisions of section 2(22)(e) of the Act - This interpretation would allow the rule of purposive construction with noscitur a sociis – Relying upon Commissioner Of Income-Tax Versus Nagindas M. Kapadia [1988 (12) TMI 89 - BOMBAY High Court] - the Court excluded from the ambit of "dividend", monies which the assessee received towards purchases – there was no infirmity in the order of CIT(A) and the same is upheld– Decided against Revenue.
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