2016 (1) TMI 84

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....kil Kureshi ) 1. The appeals are filed by the Revenue calling in question the judgement of Income Tax Appellate Tribunal, raising following question for our consideration : "Whether on facts and in law the ITAT was right in cancelling the order passed u/s 201(1) and 201(A) of the Act, without appreciating that the amount advanced was in the nature of deemed dividend u/s 2(22)(e) of the....

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.... arise and therefore, the liability u/s.201(1) and 201(A) of the Act also does not arise. For both the years under consideration, I have perused the copies of the ledger accounts placed on record. It can be seen that there are large number of debit and credit transactions. Meaning thereby, the appellant has given and received funds as and when required to and from its associate concern. It is not ....

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....ns of section 2(22)(e) of the Act in respect of deemed divided are not attracted and therefore, the question of deduction of tax at source also would not arise. This view is supported by the following direct decisions : CIT vs. Creative Dyeing & Pringint (P) Ltd. 318 ITR 476 (Del) CIT vs. Raj Kumar 318 ITR 462 (Del) NH Securities Ltd v. DCIT (2007) 11 SOT 302 (BOM) ....

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....4. It can thus be seen that the Commissioner as a matter of fact found that the payments were not in the nature of current adjustment. There was movement of fund both ways on need basis. The transactions in the nature of loans and advances are usually very few in number whereas in the present case, such transactions are in the form of current accommodation adjustment entries. The Commissioner ther....