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2016 (6) TMI 882 - AT - Income TaxDeemed dividend u/s 2(22)(e) - whether the amount advanced by the company M/s Cosmo Tribology (I) Private Limited was a trade advance or not? - Held that:- AR during the hearing of the case, also produced original bill books of the proprietary concern of the assessee, i.e., M/s Flair Impex. On examination of the bill books, we found that the assessee has maintained separate bill books for paraffin wax and slack wax and due to that bills of the same date are not having running serial numbers. We also agree with the other contentions raised by the learned Authorized Representative of the assessee that the assessee was registered to VAT and transport expenses were borne by the purchase parties. We also find from he assessee’s paper book dated 21/04/2016 that the purchases made by the company M/s Cosmo Tribology (I) Private Limited were duly mentioned in the notes to annual statement of the company for the year under consideration. In view of above facts, we are of the opinion that the transaction between the assessee and company was a commercial transaction and the payments advanced were in the nature of trade advance and in such a case respectfully following the findings of the Hon’ble Jurisdictional High Court in the case of Commissioner of Income Tax Vs. Rajkumar (2009 (5) TMI 17 - DELHI HIGH COURT ), we hold that the money advanced to give effect to a commercial transaction would not fall within the ambit of the provision of section 2(22)(e) of the Act. - Decided in favour of assessee
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