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2021 (8) TMI 718 - AT - Income TaxDisallowance u/s. 2(22)(e) - assessee has received unsecured loan and assessee company from whom it has obtained unsecured loan there were two common directors - HELD THAT:- During the course of assessment on verification, the AO noticed that assessee has obtained unsecured loan from M/s. Cygnet Infotech Pvt. Ltd. and in both the companies there was common directors having share holding not less than 10% of the voting power. Without reiterating the facts AO was of the view that any payment in the nature of an advance or loan by a closely held company in which a share holder holds more than 10% of voting to any concern in which such share holder has a substantial interest is deemed as dividend, therefore, amount of unsecured loan given by Cygnet Infotech Pvt. Ltd. to the assessee company was treated as deeded dividend u/s. 2(22)(e) of the act on account of a common share holder holding more than 10% of voting power in these concerns. With the assistance of ld. representatives , we have gone through the judicial pronouncements of the Co-ordinate Benches of ITAT on the similar issue. Since the assessee company was not registered share holder in the company from whom the loan was obtained therefore no addition can be made as deemed dividend in the hands of the assessee company merely because there was a common shareholder in the payee company and the assessee company. Therefore, we do not find any error in the decision of the ld. CIT(A). Accordingly, the appeal of the revenue is dismissed.
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