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Loan to Shareholders in the course of lending business cannot be treated as deemed dividend
Case Law Details
- Case Name
- I.T.O Ward 29(4), Kolkata Vs Shri Piyush Jalan (ITAT Kolkata)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Related Assessment Year
- 07/09/2015
- Courts
- All ITAT, ITAT Kolkata
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Brief of the Case
ITAT Kolkata has held in the case ITO Vs. Piyush Jalan that where lending of money is substantial part of the business of the concerned company and any advance or loan is made by it to a shareholder in the ordinary course of its business, the amount so advanced cannot be treated as deemed dividend under clause (e) of section 2(22). Substantial part of the business is lending of money is to be ascertained from the income of the lending company and also from the amount of loan given by the lending company during the relevant previous year.
But in the present case in both the ye...
