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TMI Blog2016 (11) TMI 1017X X X X Extracts X X X X X X X X Extracts X X X X ..... order of the Assessing Officer. 2. Counsel for the appellant has framed following substantial question of law in appeal: Whether in the facts and circumstances of the case, and in law, the learned ITAT has erred in deleting the additions of ₹ 1,17,89,159/- made by the Assessing Officer on account of deemed dividend u/s 2(22)(e) of the I.T. Act, 1961. 3. Counsel for the appellant, Mr. R.B. Mathur, has taken us to the order of the CIT (Appeals) and contended that the interest free advances given by the company has been assessed only with a view to reduce the profit of the company and to make it available to HUF which had made losses. In that view of the matter, he has placed reliance on the decision of the Supreme Court in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Supreme Court and the judgments of two High Courts, namely Delhi High Court and Calcutta High Court. 4.1. Apropos ground no.1, it emerges from the record the factual submissions about the advantages derived by company M/s Dwarka Gems from the mortgage of assessee and his family members properties have not been properly appreciated. Beside it has been demonstratively explained that assessee being MD and pioneer of the company had to carry on bulk of business transactions like, purchases, sales, overseas operations, the impugned account was the means to carry out such operations. To be fair, assessee paid interest on the remaining amount which has been taxed in the hands of the company. All these justifications have not been effectivel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses where the loan or advance is given in return to an advantage conferred upon the company by such shareholder would not come within the purview of section 2(22) (e). Assessee reliance on the analogy of Hon'ble Supreme Court judgment in the case of SA Builders (supra) also throws light on the purpose and legislative intent of such deeming provisions to deter entities from siphoning off the funds to avoid taxes. Considering the judgment also the advances being for trade and business considerations, assessee having not derived any benefit out of it and rather having acquired disadvantage for the betterment of the company's business cannot be saddled with additions u/s 2(22)(e). In consideration of entirety of facts, circumstances and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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