Case Law Details
DCIT Vs Lalitkumar K. Jain (ITAT Pune)
The issue in the present appeal relates to the applicability of section 2(22)(e) of the Act. The Assessing Officer brought to tax a sum of Rs.56,81,680/- being the amount of loan advanced by M/s. Kumar Urban Developers Ltd. to M/s. Shatrunjay Construction and Developers Pvt. Ltd.. The Assessing Officer was of the opinion that the provisions of section 2(22)(e) have application as the respondent-assessee is a common shareholders in both the companies holding more than 10% of the shares. Although, during the course of assessment proceedings, the respondent-assessee had not disputed that he is common shareholder in both the companies, however, contended that the provisions of section 2(22)(e) have no application, inasmuch as, the loan was advanced by M/s. Kumar Urban Developers Ltd. to M/s. Shatrunjay Construction and Developers Pvt. Ltd. in the ordinary course of its business. However, during the course of proceedings before the ld. CIT(A), the respondent-assessee took a plea that he was not a shareholder in M/s. Shatrunjay Construction and Developers Pvt. Ltd. at the time of granting of loan by M/s. Kumar Urban Developers Ltd. to M/s. Shatrunjay Construction and Developers Pvt. Ltd. and this contention was proved by filing the shareholding pattern of the said company. Even on remand to the Assessing Officer by ld. CIT(A), the Assessing Officer also concurred with the submission of the respondent-assessee that he is not a shareholder in M/s. Shatrunjay Construction and Developers Pvt. Ltd. at the relevant point of time. The ld. CIT(A) accordingly concluded that the provisions of section 2(22)(e) have no application to the facts of the present case.
FULL TEXT OF THE ORDER OF ITAT PUNE
This is an appeal filed by the Revenue directed against the order of ld. Commissioner of Income Tax (Appeals)-5, Pune [‘the CIT(A)’] dated 31.03.2017 for the assessment year 2007-08.
2. The Revenue raised the following grounds of appeal :-
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