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2015 (9) TMI 1243 - DELHI HIGH COURT

2015 (9) TMI 1243 - DELHI HIGH COURT - TMI - Deemed dividend u/s 2(22)(e) - loan or advance - difference between the amount paid and received during the year - Held that:- The AO has simply proceeded on the assumption that since there is an opening debit balance in the account, it should be treated as an outstanding loan and that every payment thereafter made by the Assessee to DIPL should be taken to be in the nature of repayment of the loan. The stand of the Assessee that the opening debit bal .....

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carried on during the year. The High Court answered the question in the affirmative holding that it is only the relevant entries during the year in question that had to be looked into and that only those amounts paid to the Assessee by the company during the relevant year, less the amount repaid by the Assessee in the same year, should be deemed to be dividend. No legal infirmity in the order of the ITAT. No substantial question of law arises - Decided against revenue. - ITA No. 253/2015 - Date .....

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('AY') 2009-10. 2. The Assessee is a shareholder of Dhir International Private Limited ('DIPL') having substantial interest of more than 20%. The Assessing Officer ('AO') held that during the AY in question the Assessee had received certain amounts from DIPL totalling ₹ 45,36,024. The AO treated the sum as deemed dividend under Section 2(22)(e) of the Act. 3. The Assessee's appeal was dismissed by the Commissioner of Income Tax (Appeals) ('CIT(A)') by o .....

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PL had a facility of discounting the cheque with the bank and, therefore, the Assessee issued cheque in the name of the DIPL and they paid a similar account to the Assessee and got the cheque discounted through the bank. The explanation offered by the Assessee that for each and every transaction a contra entry was made immediately within a few days except in two of the cases where DIPL delayed the deposit of Assessee's cheque with their bank, was accepted by the ITAT. The addition made by th .....

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