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Ghanshyambhai Ambalal Thakkar Versus Deputy Commisioner of Income-Tax

2017 (8) TMI 452 - GUJARAT HIGH COURT

Reopening of assessment - loan received by the petitioner from private company to be treated as a deemed dividend in terms of section 2(22)(e) - Held that:- In neither of the two documents, he has dealt with the factual assertion made by the petitioner viz. that the sum in question was advanced by the petitioner to the company and was not received by the petitioner from the company by way of a loan. The petitioner has produced the audited accounts in the balance-sheet which we have perused. - .....

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eived by the petitioner from private company should be treated as a deemed dividend in terms of section 2(22)(e). When on facts the petitioner is able to show that the amount in question was advanced by the petitioner to the company and was not received by the company by way of a loan, section 2(22)(e) would have no applicability. The impugned notice is set aside. Petition is allowed in favour of assessee. - SPECIAL CIVIL APPLICATION NO. 12763 of 2017 - Dated:- 8-8-2017 - For The AKIL KURESHI AN .....

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ncial transactions in the nature of loans with M/s Rushil Decor ltd. a private company during the year. Upon verification of the above information and analysis of the facts of the case, it is noticed that the assessee was holding 21.87% shares in the company M/s Rushil Decor Ltd. and the assessee had received ₹ 3,21,52,933/from the company during the year in the form of loans. The fact that the above mentioned receipts are in the nature of loan from the company can be seen from the Auditor .....

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.Y. 2010-11. The assessee being a substantial shareholder having more than 10% shareholding in a closely held company had received payments by way of loans from the company, these loan transactions between the assessee and company fall within the definition of section 2(22)(e) of the I.T. Act, 1961. As per the provisions section 2(22)(e) of the I.T. Act, 1961 the amount of ₹ 3,21,52,933/received as loans by the assessee from M/s Rushil Decor Ltd. was to be treated as dividend in the hands .....

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has been made u/s 143(3) of the Act. As per the above mentioned facts it is clearly seen that the assessee has understated his income by not treating the loans received from the company as dividend and not including the same in his income. Moreover, in part ABS of the ITR for 2010-11 the assessee has not shown any unsecured loans or deposits from any source. Thus, the loan received by the assessee from the company has not even been declared in the ITR. In view of above facts, I have reason to b .....

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r dated 14.06.2017. At that stage, this petition came to be filed. 3. We may notice that the return filed by the petitioner was accepted under section 143(1) of the Act without scrutiny. In that view of the matter, the grounds for challenging the notice for reopening, would undoubtedly be limited. However, counsel for the petitioner submitted that the reasons recorded by the Assessing Officer lack validity since the Assessing Officer proceeds on completely wrong factual parameter. He pointed out .....

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