2011 (8) TMI 16 - CALCUTTA HIGH COURT

Deemed dividend - Under Section 2(22)- Since, assessee permitted his property to be mortgaged to the bank for enabling the company to take the benefit of loan and in spite of request of the assessee, the company is unable to release the property from the mortgage - In such a situation, for retaining the benefit of loan availed from Vijaya Bank if decision is taken to give advance to the assessee such decision is not to give gratuitous advance to its share holder but to protect the business interest of the company - In support of such contention, assessee has relied upon a Division Bench decision of Delhi High Court in the case of Commissioner of Income-tax Vs. Creative Dyeing and Printing P. Ltd., [2009 -TMI - 34684 - DELHI HIGH COURT] - Therefore, find that the authorities below erred in law in treating the advance given by the Company to the assessee by way of compensation to the assessee for keeping his property as mortgage on behalf of the company to reap the benefit of loan as deemed dividend within the meaning of Section 2(22) (e) of the Act - Decided in favour of assessee.