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2021 (4) TMI 762 - AT - Income TaxDeemed dividend u/s. 2(22)(e) - assessee company is a concern in which the shareholders of M/s. Anyushka Investment Pvt. Ltd. (the payer company) have substantial interest - CIT-A deleted the addition - HELD THAT:- We find that it is evident from the facts above assessee is not a shareholder of the lending company that is AIPL. Hence on the touchstone of the special bench decision of Bhaumik Colour P. Ltd. [2008 (11) TMI 273 - ITAT BOMBAY-E] deemed dividend under section 2(22)(e) of the Act are not taxable in the hands of the assessee. Reliance upon the Bombay High Court decision in the case of Impact Container [2014 (9) TMI 88 - BOMBAY HIGH COURT] is also germane in as much as when it is the normal business of the lending company to give advances the receipt of advance from the same by the assessee cannot be termed as deemed dividend under section 2(22)(e) Addition of sum received as share premium u/s. 68 - issue of shares at such high premium by assessee company whose net worth is negative and purchase of the same by M/s. Anyushka Investments Pvt. Ltd. (both assessee company and AIPL has common directors) is unacceptable - CIT-A deleted the addition - HELD THAT:- As assessee has submitted all the necessary documents required to satisfy the extant provisions of section 68. The required documents as noted above in the order of learned CIT(A) and submission of the assessee's counsel were available before the assessing officer also. The said party is a group concern and it has also confirmed the transaction. Furthermore we note that assessee company has received the share capital including premium from the same group company that is AIPL, from whom it has also received loan of ₹ 1.18 crores. AO is not doubting the capacity of AIPL in granting the loan but is doubting the capacity to give the share capital. The amended provisions of section 68 of the Act providing satisfaction of the assessing officer regarding explanation from the party from whom the credit is received as per proviso to section 68 of the Act was inserted by Finance Act, 2012 with effect from 1/4/2013. The same is not applicable for this assessment year. As regards the issue of justification of share premium that is also not applicable for the assessment year under consideration as the same is applicable from 1.4.2013.The above position is duly supported by decision of honourable jurisdictional High Court in several decisions including Gagandeep Infrastructure Pvt. Ltd. [2017 (3) TMI 1263 - BOMBAY HIGH COURT] & Pr. CIT Vs. Veedhata Towers Pvt. Ltd. . [2018 (4) TMI 1004 - BOMBAY HIGH COURT] - Decided in favour of assessee.
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