Tax Management India. Com
Law and Practice  :  Digital eBook
Research is most exciting & rewarding
  TMI - Tax Management India. Com
Follow us:
  Facebook   Twitter   Linkedin   Telegram
Income Tax - Highlights / Catch Notes

Home Highlights May 2025 Year 2025 This

ITAT ruled in favor of the assessee, rejecting deemed dividend ...


Strict Interpretation of Section 2(22)(e) Prevails: Investment Not Deemed Dividend, Tax Addition Rejected

May 2, 2025

Case Laws     Income Tax     AT

ITAT ruled in favor of the assessee, rejecting deemed dividend assessment under section 2(22)(e). The tribunal distinguished between investment and advance, emphasizing strict interpretation of tax provisions. Factual findings by CIT(A) remained unchallenged by revenue, and no ingredients of deemed dividend were satisfied. The tribunal found no loan or advance received by the assessee from the referenced entities. Consequently, the assessing officer's addition was set aside, and the assessee's appeal was allowed, affirming the legal principle that fictional tax provisions must be construed narrowly.

View Source

 


 

You may also like:

  1. Deemed dividend addition u/s 2(22)(e) - Since all the conditions necessary for treating the deemed dividend of the amount received in the hands of concern (which in this...

  2. Deemed Dividend - addition of advance salary as deemed dividend - advance was not in the nature of loan and hence cannot be treated as deemed dividend u/s 2(22)(e) - AT

  3. Deemed dividend u/s 2(22)(e) arises when an interest-free loan is provided by a company to a substantially related concern in shareholding. The issue was whether the...

  4. Deemed dividend addition u/s 2(22)(e) - Provisions of Section 2(22)(e) relating to loan or advance can be deemed as dividend only to the extent of accumulated profit or...

  5. Deemed dividend addition u/s.2(22) - trade advance in relation to business transaction cannot be treated as deemed dividend - AT

  6. Deemed dividend under sec. 2(22)(e) - Initially, the assessee has chosen to declare the deemed dividend in his hand, later come with different explanation at different...

  7. Deemed dividend u/s. 2(22)(e) - the loan given by the company only in the immediate preceding year, i.e., assessment year 2007-08, should be assessed as deemed dividend...

  8. Set off of deemed dividend against actual dividend paid by certain companies - dividend distribution tax as per section 115-O is in respect of dividend covered u/s...

  9. Deemed dividend u/s 2(22)(e) - oan or advance to a non-shareholder cannot be taxed as deemed dividend in the hands of the a non shareholder - AT

  10. The assessee claimed deduction of expenditure incurred for handling and disposal of spent solvents/scrap against unaccounted cash receipts from their sale. The ITAT held...

  11. Deemed dividend under Section 2(22)(e) - addition only qua the peak amount - Whether addition should be restricted to the peak amount of the loans given during the year?...

  12. Deemed dividend u/s 2(22)(e) - Substantial interest in lending company - common shareholder - The definition of shareholder is not enlarged by any fiction. - under no...

  13. ITAT adjudicated a tax dispute involving unaccounted cash receipts and deemed dividend. The tribunal directed the Assessing Officer to allow 60% of expenditure against...

  14. Deemed dividend u/s 2(22))e) - repayment of loan or advance by the Company

  15. Deemed dividend u/s 2(22)(e) - transactions made by the assessee and the company are for business purposes and are not deemed dividend under section 2(22)(e) - AT

 

Quick Updates:Latest Updates