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TMI Blog2014 (5) TMI 429X X X X Extracts X X X X X X X X Extracts X X X X ..... d as dividend u/s 2(22)(e) only in case of a person who is a shareholder of the payer company, both registered as well as beneficial - the amount cannot be considered as the income of the debtor or the recipient concern or company -there could be no escapement from assessment qua the same - the view entertained by the AO is without any basis in law - there was no valid assumption of jurisdiction in the first place - the reopening of the assessment on that ground per section 148 is bad in law – Decided against Revenue. - I.T.A. No. 2881/Mum/2012 - - - Dated:- 30-4-2014 - Shri D. Manmohan, VP And Shri Sanjay Arora, AM,JJ. For the Appellant : Shri Pitambar Das For the Respondent : None ORDER Per Sanjay Arora, A. M. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lder in Shri Uday B. Desai; his shareholding in the two companies being as under: 1. Unicorn Connectors P. Ltd. 40% 2. Unix Connections P. Ltd. (assessee) 20% The books of the assessee-company reflected a credit of Rs.13,735/- as at the relevant year-end (i.e., 31.03.2005) from M/s. Unicorn Connectors P. Ltd., whose accumulated profit by that date was Rs.9,60,128/-. Accordingly, the loan received from the said company during the year was liable to be considered as deemed dividend u/s. 2(22)(e) of the Act. Notice u/s.148 was, therefore, issued and the assessment framed by subjecting the said amount to tax as deemed dividend u/s. 2(22)(e) r/w s. 56 of the Act. The assessee contested the assessment in appeal, among others, on the grou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upheld the Revenue s stand. So however, the hon ble court has vide its decision dated 22.03.2010 (so that it would have been admitted prior thereto, or as on 18.03.2010) in the case of CIT vs. Universal Medicare Pvt. Ltd. [2010] 324 ITR 263 (Bom) clarified that the deemed dividend could only be assessed in the hands of the share-holder, i.e., for whose benefit the loan or advance is given or considered as given, as Shri Uday B. Desai in the instant case. That is, a sum advanced could be deemed as dividend u/s.2(22)(e) only in case of a person who is a shareholder of the payer company, both registered as well as beneficial, confirming the view as taken by the tribunal in the case of Bhaumik Colour P. Ltd. (supra). The said amount, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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