Advance receipt by Lending Company in the course of business cannot be treated as Deemed Dividend

DCIT Vs Svarna Infrastructure & Builders Pvt. Ltd. (ITAT Kolkata) The issue under consideration is whether the receipt of advance vis-a-vis no accumulated profit in case of lending company is considered as deemed dividend u/s 2(22)(e)? ITAT states that when dividends are declared by a company, it is solely the shareholders who benefit from the transaction. No benefits accrue to the company by way of dividend distribution. Thus, section 2(22)(e) of the Act covers only such situations, where the shareholder alone benefits from the loan transaction, because if the company also benefits from t...