TaxTMI 
TaxTMI 
2021 (10) TMI 900
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....ely and since a common issue is involved therein, the same have been heard together and are being disposed of by a single consolidated order. 2. The solitary common issue involved in these appeals of the Revenue relates to the deletion by the Ld. CIT(A) of the additions made by the AO on account of deemed dividend u/s 2(22)(e) of the Income Tax Act, 1961. 3. The assessee in the present case is a company which is engaged in the business of property development. The returns of income for both the years under consideration were filed by it on 28.09.2015 & 30.09.2019 declaring losses of Rs. 2,00,75,757/- & Rs. 1,57,35,156/- for A.Y. 2015-16 & 2016-17 respectively. During the course of assessment proceedings, it was noticed by the AO that the ....
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....sons. iv. M/s. Multiplex Equipments & Services Private Ltd. is mainly in the business of amenity & services. The same is very much evident from the analysis of the Profit & Loss A/c of M/s. Multiplex Equipments & Services Private Ltd., for the F.Y. 2014-15 and F.Y. 2015-16. v. On perusal of the Balance Sheet of the lender company, the picture remains the same as only out of a total asset of Rs. 4005.51 lacs only Rs. 182.01 lacs has been shown as loan to relative party. vi. On perusal of the Balance Sheet of M/s. Multiplex Equipments & Services Pvt. Ltd. as on 31.03.2015 and 31.03.2016, it is seen that the company is having accumulated profit to the tune of Rs. 251.08 lacs & Rs. 45.70 lacs which is more than the amount of loan given....
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....td. i. S M Shroff was beneficiary shareholders of both the borrower company i.e. assessee company and the lender company i.e M/s Hind Ceramics Pvt. Ltd. having substantial shareholdings in the both companies. ii. The percentage shareholding of S M Shroff was shown at 25.36% and 25.00% in the assessee company and M/s Hind Ceramics Pvt. Ltd. respectively in their books of accounts. iii. Public have no substantial interest in the lender company M/s Hind Ceramics Pvt. Ltd. and it is closed held company of the assessee company having common key persons. iv.M/s.Hind Ceramics Private Ltd. is mainly in the business of maintenance & services. The same is very much evident from the analysis of the Profit & Loss A/c of M/s. Hind Ceramics P....
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....pellate proceedings the assessee had produced ledger account of three entities from whom loan transactions took place. The entities are Multiplex Equipments & Services Pvt. Ltd. - Rs. 203,25,000/- Vidyut Electricals & Electronics Pvt. Ltd. - Rs. 200,44,0007- Hind Ceramics Pvt. Ltd. - Rs. 139,00,000/- The audited balance sheets of these entities were also produced. From the perusal of these documents it is clear that interest has been charged on these loans and these loans have been substantially returned. The average minimum holding of loan amount in case of these entities is as under - Minimum average holding Interest charged TDS deducted Multiplex Equipments & Services Pvt. Ltd. 79 days 7,52,576 75,258 Vidyut ....
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....velopment & Construction Company Pvt. Ltd. i.e. assessee is not a share holder or registered member of Multiplex Equipment & Services Pvt. Ltd., Vidyut Electricals & Electronics Pvt. Ltd. & Hind Ceramics Pvt. Ltd. Therefore, on factual as well as on legal grounds the deemed dividend u/s 2(22)(e) amounting Rs. 7,93,18,503/- was not tenable in this case, for A.Y. 2015-16. It has already been held that these transactions do not attract deemed dividend u/s 2(22)(e) of the I.T. Act, 1961. Following the same and catena of judgement submitted on this issue by the AO, the addition on account of deemed dividend u/s 2(22)(e) of the I.T. Act, 1961is hereby deleted." Aggrieved by the order of the Ld. CIT(A) deleting the addition made by the AO on acc....