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2016 (11) TMI 394 - HC - Income TaxDeemed dividend under Section 2(22)(e) - Held that:- It is not the case of the Revenue that the respondent assessee company is a mere shell and Capt. Salvi and company are one and the same. In fact, the Assessing Officer proceeds on the basis that as the assessee company and M/s. Alfa Distilleries P. Ltd. and M/s. Vulcan Distilleries P. Ltd. had common shareholders, therefore, the amounts received by the respondent assessee as loans and advances from the two companies are to be considered as deemed dividend under Section 2(22)(e) of the Act. The Tribunal in the impugned order has held that as the respondent assessee is not shareholder of M/s. Alfa Distilleries P. Ltd. and M/s. Vulcan Distilleries P. Ltd. who had advanced loans to the respondent assessee. Therefore, the amount of loans made to the respondent assessee cannot be taxed in the hands of the respondent assessee as it is not a shareholder of M/s. Alfa Distilleries P. Ltd. and M/s. Vulcan Distilleries P. Ltd. It is an undisputed position as fairly submitted by Mr. Suresh Kumar that the question raised herein is concluded against the Revenue and in favour of the respondent assessee by the decisions of this Court in Commissioner of Income Tax Vs. Universal Medicare Pvt. Ltd. [2010 (3) TMI 323 - BOMBAY HIGH COURT ] and Commissioner of Income Tax Vs. Vs. Impact Containers (P) Ltd. [2014 (9) TMI 88 - BOMBAY HIGH COURT ] that deemed dividend has to be taxed in the hands of the shareholder of the company giving the loans and / or advance. In this case, admittedly, the respondent assessee is not a shareholder of the two companies i.e. M/s. Alfa Distilleries P. Ltd. and M/s. Vulcan Distilleries P. Ltd. - Decided in favour of assessee.
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