2014 (2) TMI 1226

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....nt. V. RamachandranandM/s. Anitha Sumanth, for the Respondent. JUDGMENT R. Jayasimha Babu, J. The question referred to us at the instance of the Revenue is : "Whether the Tribunal was right in law and had valid materials in holding that the advance (rental) received by the assessee from the company in which he is a shareholder cannot be termed as a deemed dividend for the purpose of se....

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.... That document contained a further provision that for the purpose of meeting the cost of construction of the other three floors, the company should advance a sum of Rs. 10 lakhs to the assessee which would be adjusted towards rent for the premises. After the completion of the construction of the other floors a further lease deed was entered into on May 3, 1984, by which the second, third and fourt....

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....ase of Miss P. Sharda v. CIT [1998] 229 ITR 444 considered section 2(22)(e) of the Act and held that : ". . . The loan or advance taken from the company may have been ultimately repaid or adjusted, but that will not alter the fact that the assessee, in the eye of law, had received dividend from the company during the relevant accounting period." (p. 448) The fact that advance paid to the ass....

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....akhs when it had taken the first floor on lease for the purpose of meeting the cost of construction of the other three floors and that the lease deed provided explicitly that the advance so paid was to be adjusted against the rent payable for the other three floors. The amount of rent payable for those floors was also set out in the further lease. The advance therefore was required to be set off a....