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2014 (11) TMI 1222 - AT - Income TaxDeemed dividend u/s.2(22)(e) - assessee was in receipt of the amount from M/s JMD Marketing Pvt. Ltd. as loan - HELD THAT:- We found that similar issue has been considered by the Hon’ble Punjab and Haryana High Court in the case of Shri Suraj Dev Dada [2014 (5) TMI 625 - PUNJAB & HARYANA HIGH COURT] wherein it was held that assessee having running account with the company, the provisions of Section 2(22)(e) were not attracted as this provisions was inserted to stop the misuse by the assessee by taking the funds out of the company by way of loans advances instead of dividends and thereby avoid tax. Applying the proposition of law as discussed above to the facts of the present case, we found that assessee was having debit balance only for 17 days out of 365 days. On all other dates, assessee was having credit balance and peak of such credit. It is also a matter of record that assessee has not charged any interest in respect of temporary advance given to the company. Accordingly, we do not find any merit in the action of the lower authorities for bringing such transaction in the net of the Section 2(22)(e) of the Act. - Appeal filed by the assessee is allowed.
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