TMI Blog1976 (8) TMI 32X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1922 ?" The matter lies within a very narrow compass. The assessee is a shareholder of Trichy Mining Works Ltd. According to the entries in the current account of the company, there were debts against the assessee of Rs. 18,864 by October 26, 1960, and further debts totalling Rs. 16,396 from October 31, 1960, to December 5, 1960, so that the total of the debts came to Rs. 35,260. Thus, by December 5, 1960, the assessee had taken an advance of Rs. 35,260. The previous year of the assessee for the assessment year 1961-62 was from April 1, 1960, to March 31, 1961. The Income-tax Officer sought to assess this particular sum of Rs. 35,260 as dividend in the hands of the assessee under the provisions of section 2(6A)(e) of the Indian Incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany in which the public are not substantially interested. Therefore, if the other requirements are satisfied, section 2(6A)(e) will apply. There is no dispute again that the amount in question is an advance taken by the assessee from the company. Consequently, the only other question is whether the company had accumulated profits on the date when the advance was taken by the company. It is not disputed that as on March 31, 1960, the profit and loss account of the company showed a debit balance of Rs. 4,989. Consequently as on April 1, 1960, during which financial year the assessee had taken the loan, the company had no accumulated profits whatever. But the contention that was advanced on behalf of the department was that during the year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Income-tax Appellate Tribunal has been set out as follows in paragraph 6 of its order : The department has now come on appeal before us disputing the decision of the Appellate Assistant Commissioner,the only argument being that in arriving at the accumulated profits of the company, the profits relating to the period up to the dates of the, payments should also be taken into account. We were not told what the extent of such profits would be and we have also not gone into various other rival contentions which may arise in determining how much, out of the payments to the assessee, if at all any amount, could be treated as dividend." This contention advanced by the department before the Appellate Tribunal is directly opposed to the conc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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