Income Tax - Deemed dividend income u/s. 2(22)(e) on ‘loans and advances’...

Income Tax

Deemed dividend income u/s. 2(22)(e) on ‘loans and advances’ - Though the assessee company has taken a plea that alleged loan has been taken for commercial expediency during the year and are in the nature of business transaction and interest paid thereon. However, the exception which the assessee has been referring provided under section 2(22)(e) applies in the case where lending of money is a substantial part of the business of the company. - since no enquiry has been conducted by the ld.AO on the issue raised in show cause notice u/s. 263, therefore, to this extent the assessment order is rightly held to be erroneous so far as it is prejudicial to the interest of the revenue. - AT

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