Addition u/s. 2(22)(e) untenable as trade advances cannot be characterized as loans or advance

MSN Pharmachem Private Limited Vs ACIT (ITAT Hyderabad) ITAT Hyderabad held that trade advances, in the nature of commercial transactions, cannot be characterized as ‘loans or advance’ constituting deemed dividend within the meaning of section 2(22)(e). Thus, addition towards deemed dividend untenable. Facts- The appellant company is engaged in the business of manufacturing and sale of drugs and pharmaceuticals. Post search operation, the case was selected for scrutiny and the assessment was completed u/s. 143(3) r.w.s. 153A of the Income Tax Act, 1961, for assessment year 2019-20 on 03-04...