https://www.taxtmi.com/caselaws?id=462879 The ITAT Rajkot dismissed the Revenue's appeal regarding deemed dividend under Section 2(22)(e) for inter-corporate deposits. The assessee received a loan from a sister concern where a common shareholder held 98.76% in the assessee company and 59.17% in the lending company. The CIT(A) had deleted the addition after the assessee explained the transaction as an inter-corporate deposit to a sister concern in financial need, as bank deposits were not viable. The Revenue's representative conceded that the assessee held no shares in the lending company and that Section 2(22)(e) provisions could not apply. The ITAT relied on the SC precedent in Madhur Housing Development & Co, establishing that deemed dividend provisions cannot be invoked when loans are given in the normal course of business benefiting both companies. en-us Fri, 20 May 2022 00:00:00 +0530 Tue, 22 Jul 2025 20:35:15 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=462879 The ITAT Rajkot dismissed the Revenue's appeal regarding deemed dividend under Section 2(22)(e) for inter-corporate deposits. The assessee received a loan from a sister concern where a common shareholder held 98.76% in the assessee company and 59.17% in the lending company. The CIT(A) had deleted the addition after the assessee explained the transaction as an inter-corporate deposit to a sister concern in financial need, as bank deposits were not viable. The Revenue's representative conceded that the assessee held no shares in the lending company and that Section 2(22)(e) provisions could not apply. The ITAT relied on the SC precedent in Madhur Housing Development & Co, establishing that deemed dividend provisions cannot be invoked when loans are given in the normal course of business benefiting both companies. Case-Laws Income Tax Fri, 20 May 2022 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=462879