TaxTMI 
TaxTMI 
2019 (5) TMI 193
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....Appellate Tribunal, 'A' Bench, Chennai, dated 29.12.2016 in ITA No.2655/MDS/2016, raising the following substantial questions of law: "1.Whether the Appellate Authority was right in law to hold that the transaction of transferring the asset of the Company for a due consideration amounts to dividend as per the provisions of Section 2(22)(e) of the Income Tax Act, 1961? 2.Whether the Authorities were right in preferring an appeal against the order passed by the CIT(A) deleting the addition done by the Assessing Officer holding that the transaction does not fall under the purview of Sec.2(22)(e) of the Income Tax Act, 1961 in derogation of the bar imposed by the CBDT vide its Circular No.21/2015 dated 10th December 20....
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....the orders of the lower authorities. As per Sec.2(22)(e) of the Income Tax Act deemed dividend is - "any payment by a company, not being a company in which the public are substantially interested, of any sum otherwise) by way of advance or loan to a shareholder being a person who is the beneficial owner of shares holding not less than ten per cent of the voting power, or to any concern in which such shareholder is a member or a partner and in which he has a substantial interest or any payment by any such company on behalf, or for the individual benefit, of any such shareholder, to the extent to which the company in either case possesses accumulated profits." 6.From the above definition, deemed dividend u/s.2(22)(e) is any ....
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.... be distributed in money; it may be distributed by delivery of property or right having monetary value". We reproduced the relevant extract of the Hon'ble Supreme Court cited supra. Dividend need not be distributed in money; it may be distributed by delivery of property or right having monetary value. The resolution, it is true, did not purport to distribute the right amongst the shareholders as dividend. It did not also take the form of a resolution for distribution of dividend; it took the form of distribution of a right which had a monetary value. But by the form of the resolution sanctioning the distribution, the true character of the resolution could not be altered. We are, therefore, of the view that the High Court was ri....
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.... Delhi vs. S.R.M.B.Dairy Farming (P) Ltd., reported in (2018) 13 SCC 239, in support of his preliminary contention. 5.Per contra, Mr.T.R.Senthilkumar, learned Senior Standing Counsel for the respondent, submitted that the case falls within the exception of Clause 6(c) of the said Instruction No.3 of 2011 dated 09.02.2011 and therefore the Revenue was not bound to withdraw the said appeal from the Tribunal and the Tribunal has rightly decided the case on merits. On the merits of the case, the learned counsel for the Revenue has supported the impugned order and submitted that the unpaid price of the flat sold by the company to the Director-Assessee, of which the major part of the sale price was not paid by the Director, the Tribunal rightl....
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....inding on the Court or the Tribunal, nor the Board could direct the concerned Court or Tribunal to compel the litigant to withdraw such appeal. 7.Once the learned Tribunal has pronounced upon the merits of the appeal of the Assessee, the first contention raised by the learned counsel for the Assessee that the appeal before the Tribunal was not maintainable, is infructuous and this Court cannot set aside the order passed by the Income Tax Appellate Tribunal on merits, on account of the aforesaid Instruction No.3 of 2011 dated 09.02.2011, even if it is held to be applicable to this case. 8.Coming to the merits of the case, we do not find any substantial questions of law arising in the present case, as admittedly on facts, it was found b....