Loan Between Companies- Both Conditions Must Apply! ITAT Clarifies 2(22)(e) & Grants Relief

Late Ramasamy Pongianna Gounder Desamani Vs ITO (ITAT Chennai) Assessee filed his return declaring income of ₹4,16,100. The case was reopened u/s 147 on 27.03.2018 & return was again filed declaring the same income. AO noticed that M/s Cheran Spinners Ltd. had advanced ₹10.38 crore as loan to M/s Best Cheran Spintex India Ltd. in which  Assessee was a significant shareholder. AO held that since Assessee held 23.69% shares in the lending company (Cheran Spinners Ltd.) &  17.28% shares in the borrowing company (Best Cheran Spintex India Ltd.), the proportionate amount of loan of �...