For s. 2(22)(e), a firm can be treated as the ‘shareholder’ even though it is not the registered shareholder and shares are in the name of Partners

CIT Vs M/s National Travel Services (Delhi High Court)- The respondent/assessee is a partnership firm consisting of three partners namely Mr. Naresh Goyal, Mr. Surinder Goyal and M/s Jet Enterprises Pvt. Ltd. having profit sharing ratio of 35%, 15% and 50% respectively. The assessee firm had taken a loan of ` 28,52,41,516/- from M/s Jetair Pvt. Ltd. New Delhi. In this company the assessee has invested by subscribing to the equity share numbering 1,43,980 of ` 100 each which constitute 48.18%. However, the shares were purchased in the name of the two partners namely Mr. Naresh Goyal and Mr. Surinder Goyal. Thus, whereas, Mr. Naresh Goyal and Mr. Surinder Goyal are the respective share holders, the assessee is the beneficial share holder. On these facts, in this appeal we are concerned with the first limb [in contradiction to second limb that fell for interpretation in Ankitech (supra)] and are called upon to examine as to whether this first limb of Section 2(22)(e) of the Act has been satisfied. We should point out at the outset that it is an admitted position that all other conditions stipulated in Section 2(22)(e) of the Act are fulfilled. The extent of share holding is also so high that the assessee has indubitably substantial interest in Jetair Pvt. Ltd.