TMI Blog2021 (10) TMI 900X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot be said to be deemed dividend within the meaning of section 2(22)(e). Gratuitous loan or advance given by a company to those classes of shareholder thus would come within the purview of section 2(22)(e) and not the cases where loans or advances given in return to an advantage conferred upon the company by such shareholder. In the present case, the entire amount in question was taken by the assessee-company on interest and since the interest on the said loan was duly paid by the assessee-company after deducting tax at source, we find no infirmity in the impugned orders of the Ld. CIT(A) in deleting the addition made by the AO treating the said amount as deemed dividend under section 2(22)(e) - Decided against revenue. - I.T.A. Nos. 1922 & 1923/Kol/2019 (Assessment Year: 2015-16 & 2016-17) - - - Dated:- 18-8-2021 - SHRI P.M. JAGTAP, HON BLE VICE PRESIDENT (KZ) AND SHRI A. T. VARKEY, HON BLE JUDICIAL MEMBER Shri Devi Sharon Singh, CIT appearing on behalf of the Revenue. Shri Soumitra Choudhury, Advocate appearing on behalf of the Revenue. ORDER PER P.M. JAGTAP, VICE-PRESIDENT (KZ) These two appeals are preferred by the Revenue against tw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d 50.00% in the assessee company and M/s. Multiplex Equipments Services Private Ltd. respectively in their books of account. iii. Public have no substantial interest in the lender company M/s. Multiplex Equipments Services Private Ltd. and it is closed held company of the assessee company having common key persons. iv. M/s. Multiplex Equipments Services Private Ltd. is mainly in the business of amenity services. The same is very much evident from the analysis of the Profit Loss A/c of M/s. Multiplex Equipments Services Private Ltd., for the F.Y. 2014-15 and F.Y. 2015-16. v. On perusal of the Balance Sheet of the lender company, the picture remains the same as only out of a total asset of ₹ 4005.51 lacs only ₹ 182.01 lacs has been shown as loan to relative party. vi. On perusal of the Balance Sheet of M/s. Multiplex Equipments Services Pvt. Ltd. as on 31.03.2015 and 31.03.2016, it is seen that the company is having accumulated profit to the tune of ₹ 251.08 lacs ₹ 45.70 lacs which is more than the amount of loan given to the assessee company in F.Y. 2014-15 2015-16. Vidyut Electricals Electronics Pvt. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Balance Sheet of M/s. Hind Ceramics Private Ltd. as on 31,03.2015 and 31.03.2016, it is seen that the company is having accumulated profit to the tune of ₹ 948.78 lacs 903.37 lacs which is more than the amount of loan given to the assessee company in F.Y. 201415 2015-16. 5. On the basis of the above findings recorded by him, the AO treated the loan amount aggregating to ₹ 5,42,69,000/- ₹ 8,69,31,195/- received by the assessee-company from the three concerns as deemed dividend u/s 2(22)(e) and an addition of ₹ 5,42,69,000/- ₹ 8,69,31,195/- was made by him to the total income of the assessee in the assessment completed u/s 143(3) of the Act vide orders dated 27.11.2017 20.12.2018. 6. Against the orders passed by the AO u/s 143(3) for the years under consideration, appeals were preferred by the assessee before the Ld. CIT(A) and after considering the submissions made on behalf of the assessee-company, the Ld. CIT(A) deleted the addition made by the AO on account of deemed dividend u/s 2(22)(e) for the following reasons given in his impugned orders for A.Y. 2015-16 2016-17: For A.Y. 2015-16 I have gone through the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TDS Multiplex Equipment Services Pvt. Ltd. 2388341 No 2388341 3277318 5721585 62140 6214 Vidyut Electricals Electronics Pvt. Ltd. 9930162 No 17542834 296990 18176648 374227 37423 Hind Ceramics Pvt. Ltd. 79318503 No 67000000 9691549 78518707 203017 203018 From the above, it can be seen that the above transactions are business transactions where both the companies are benefitting. The assessee company has paid the interest and deducted TDS also. Moreover, the Heilgers Development Construction Company Pvt. Ltd. i.e. assessee is not a share holder or registered member of Multiplex Equipment Services Pvt. Ltd., Vidyut Electricals Electronics Pvt. L ..... X X X X Extracts X X X X X X X X Extracts X X X X
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