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2018 (1) TMI 993 - AT - Income TaxDeemed dividend u/s 2(22)(e) - company M/s. First Tek Pvt. Ltd. had advanced a sum of ₹ 35 lakhs to M/s. Vijetha Constructions which in turn has executed promissory note in favour of the assessee, thereby derived the benefit of advance to M/s Vijetha Constructions from the company in which the assessee has substantial interest - Held that:- The deemed dividend is applicable in circumstances of payment made by the company to the shareholder, having beneficial ownership of 10% or more than 10% of the shares, the amount should have been provided by way of loan or advance to shareholder and such amount should be for the benefit of the shareholder and the company should have sufficient reserves. In the instant case, it is established that the payment of ₹ 35 lakhs by cheque No.685243 was towards the consideration for purchase of flat from M/s. Vijetha Constructions by M/s. First Tek Pvt. Ltd and none of the conditions or clauses discussed above are applicable in the case of the assessee - benefit out of payment made to M/s. Vijetha Constructions by M/s. First Tek Pvt. Ltd, hence, no case for holding the amount as deemed dividend - Decided in favour of assessee.
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