TaxTMI 
TaxTMI 
TaxTMI 
2020 (7) TMI 275
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....ssessee company are holding substantial interest in the said concern. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in directing that the amount of Rs. 2,85,56,335/- received from M/s Shesha-Sai Infraprojects Pvt. Ltd. should not be treated as deemed dividend u/s 2(22)(e) of the I.T Act, even though the assessee company has received the loans from a company in which the substantial shareholder(s) of the assessee company are holding substantial interest in the said concern. 3. The appellant craves to leave, add, amend, alter or vary any of the grounds of appeal at thetime and/or before the hearing of the appeal." 2. Briefly stated, the assessee company which is engaged in the business of a builder and property developer had filed its return of income for A.Y 2011-12 on 10.12.2011, declaring its total income at Rs. 15,25,010/-. The return of income filed by the assesse was processed as such u/s 143(1) of the Act. Subsequently, the case of the assessee was selected for scrutiny assessment u/s 143(2) of the Act. 3. In the course of the assessment proceedings it was observed by the A.O that the assessee had received amounts from two comp....
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....he assessee company i.e M/s Vrisa Infotech Pvt. Ltd., M/s Sesha-sai Infraprojects Pvt. Ltd and M/s Vrisa Creation Pvt. Ltd. Adverting to the mandate of Sec. 2(22)(e) of the Act, the A.O held a conviction that as the assessee company had received loans from the aforesaid companies in which its substantial shareholder(s) were holding substantial interest, therefore, the respective advances received by the assessee company would fall within the meaning of 'deemed dividend' u/s 2(22)(e) of the Act. Accordingly, the A.O assessed the respective amounts received by the assessee company from the aforementioned concerns viz. (i). M/s Vrisa Creations Pvt. Ltd. : Rs. 87,38,000/-; and (ii). M/s Sesha-sai projects Pvt. Ltd. : Rs. 2,85,56,355 as 'deemed dividend' u/s 2(22)(e) of the Act. After inter alia making an addition of an amount aggregating to Rs. 3,72,94,335/-[Rs. 87,38,000/- (+) Rs. 2,85,56,335/-] as 'deemed dividend' u/s 2(22)(e) of the Act, the income of the assessee was assessed at Rs. 6,04,79,060/-. 4. Aggrieved, the assessee inter alia assailed the addition made by the A.O u/s 2(22)(e) of the Act, before the CIT(A). It was observed by the CIT(A) that as the assessee company was no....
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..... The effect of s. 2(22) is to provide an inclusive definition of the expression dividend. Clause (e) expands the nature of payments which can be classified as a dividend. Clause (e) of s. 2(22) includes a payment made by the company in which the public is not substantially interested by way of an advance or loan to a shareholder or to any concern to which such shareholder is a member or partner, subject to the fulfilment of the requirements which are spelt out in the provision. Similarly, a payment made by a company on behalf, or for the individual benefit, of any such shareholder is treated by cl. (e) to be included in the expression 'dividend'. Consequently, the effect of cl. (e) of s. 2(22) is to broaden the ambit of the expression 'dividend' by including certain payments which the company has made by way of a loan or advance or payments made on behalf of or for the individual benefit of a shareholder. The definition does not alter the legal position that dividend has to be taxed in the hands of the shareholder. As such, the dividend within the meaning of cl. (e) of Sec. 2(22) can only be brought to tax in the hands of the shareholder. Our aforesaid view is fort....
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....vides as follows: (5) The pronouncement may be in any of the following manners :- (a) The Bench may pronounce the order immediately upon the conclusion of the hearing. (b) In case where the order is not pronounced immediately on the conclusion of the hearing, the Bench shall give a date for pronouncement. In a case where no date of pronouncement is given by the Bench, every endeavour shall be made by the Bench to pronounce the order within 60 days from the date on which the hearing of the case was concluded but, where it is not practicable so to do on the ground of exceptional and extraordinary circumstances of the case, the Bench shall fix a future day for pronouncement of the order, and such date shall not ordinarily be a day beyond a further period of 30 days and due notice of the day so fixed shall be given on the notice board. As such, "ordinarily" the order on an appeal should be pronounced by the bench within no more than 90 days from the date of concluding the hearing. It is, however, important to note that the expression "ordinarily" has been used in the said rule itself. This rule was inserted as a result of directions of Hon'ble High Court in the case of Shivsagar Veg R....
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....red after 15.03.2020 then the period from 15.03.2020 till the date on which the lockdown is lifted in the jurisdictional area where the dispute lies or where the cause of action arises shall be extended for a period of 15 days after the lifting of lockdown". Hon'ble Bombay High Court, in an order dated 15th April 2020, has, besides extending the validity of all interim orders, has also observed that, "It is also clarified that while calculating time for disposal of matters made time-bound by this Court, the period for which the order dated 26th March 2020 continues to operate shall be added and time shall stand extended accordingly", and also observed that "arrangement continued by an order dated 26th March 2020 till 30th April 2020 shall continue further till 15th June 2020". It has been an unprecedented situation not only in India but all over the world. Government of India has, vide notification dated 19th February 2020, taken the stand that, the coronavirus "should be considered a case of natural calamity and FMC (i.e. force majeure clause) maybe invoked, wherever considered appropriate, following the due procedure...". The term 'force majeure' has been defined in Black's Law....