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2020 (4) TMI 820 - AT - Income TaxDeemed dividend addition u/s 2(22)(e) - assessee is having substantial interest in M/s. Kasani Hotels and Resorts Pvt Ltd., by holding more than 20% shares or not? - HELD THAT:- Apparently, the business transaction is only between the assessee and his family members with M/s.Amsri group of concerns. In this situation, the explanation presented by the assessee cannot be simply brushed aside. If the assessee has withdrawn the amount from M/s. Kasani group of Companies which was received from Amsri Group of business entities due to the business transaction between the assessee and his family members with Amsri Group of business entities then it cannot be said that M/s. Kasani group of Companies has extended loan to the assessee. There is nothing on record to suggest that there is any business relationship between M/s. Amsri Group of entities and M/s. Kasani Group of Companies other than the business transaction between M/s. Amsri group of companies with the assessee and his family members. Hence it is obvious that M/s. Kasani Group of Companies had been only used as a conduit by M/s. Amsri Group of companies to deliver the money to the assessee and his family. In such situation, the financial transaction between the M/s. Kasani Hotels and Resorts Pvt Ltd., and the assessee cannot be treated as loan transaction. Therefore, the provisions of section 2(22)(e) of the Act shall have no application in the case of the assessee. - Decided in favour of assessee.
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