New User   Login      
Tax Management India .com TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (7) TMI 934 - CALCUTTA HIGH COURT

2016 (7) TMI 934 - CALCUTTA HIGH COURT - [2016] 386 ITR 128 - Deemed dividend u/s 2(22)(e) - amount under the head ‘reserve and surplus’ representing share premium and credit balance of profit and loss account - Held that:- Income Tax Appellate Tribunal was justified in allowing relief to the assessee by treating the amount under the head ‘reserve and surplus’ representing share premium and credit balance of profit and loss account as not falling within the ambit of deemed dividend under section .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

dated 8th August, 2008 passed by the learned Income Tax Appellate Tribunal, A Bench, Kolkata in ITA No.73/Kol/2008 pertaining to the assessment year 2004-05 by which an appeal preferred by the revenue was dismissed. The aggrieved, the revenue, has come up in appeal. The following question of law was formulated on 1st April, 2009 when the appeal was admitted : Whether the Income Tax Appellate Tribunal was justified in allowing relief to the assessee by treating the amount under the head reserve a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ts were treated as deemed dividend by the assessing officer. The finding of the assessing officer was reversed by the CIT (Appeal) and upheld by the learned Tribunal. It is against this order that the present appeal has been preferred. The necessary ingredients in order to impart character of deemed dividend to any payment made by a company is that such payment should have been made by the company from out of its accumulated profits. It is not in dispute that in the hands of Anjani High Rise Pvt .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

remium account. Unless the payment is made from out of accumulated profits the payment does not partake the character of deemed dividend, as would appear from Section 2(22)(e), from a plain reading thereof for which no elaboration is required. The question still remains as to whether Pushpak Commercial Finance Pvt.Ltd. can be said to have lent a sum of ₹ 18,36,454/- from out of the accumulated profits. That question has been answered in the negative by the learned Tribunal by relying on th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s answered by the learned Tribunal as follows : Coming to the aspect of substantial part of business as per clause (ii) of section 2(22)(c) it has been agitated by the department that in the case of Pushpak Commercial Finance Pvt. Ltd. A.O. should be upheld as less than 51% application of funds is towards money lending. The assessee has canvassed that 34.98% as considered by the CIT(A) should be upheld. We have seen that registration for a specific activity was accorded to the said lending compa .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n who is the beneficial owner of the equity shares not less than 20% of the voting power. Strength has also been drawn on behalf of the assessee from clause (b) of Explanation 3 to Section 2(22) which lays down that a person shall be deemed to have a substantial interest in a concern other than a company if he is at any time during the previous year beneficially entitled to not less than 20% of the income of such concern. Inviting attention to Section 13(3)(b) of IT Act it was submitted that the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version