Loan Repayment Does Not Prevent Deemed Dividend Taxation: ITAT Delhi

International Management Technologies Pvt. Ltd. Vs ACIT (ITAT Delhi) The Delhi Income Tax Appellate Tribunal (ITAT) dismissed the assessee’s appeal and upheld the addition of Rs. 1.50 crore as deemed dividend under Section 2(22)(e) of the Income-tax Act, 1961. The dispute arose from a loan advanced by a closely held company to the assessee company during AY 2015-16. The lending company held 49.30% shares in the assessee, while the assessee held 50.01% shares in the lending company. During the original assessment, the Assessing Officer treated the amount as deemed dividend and made an add...