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TMI Blog2017 (12) TMI 864X X X X Extracts X X X X X X X X Extracts X X X X ..... RI. P.K.R.Menon,Senior Counsel, GOI(Taxes) And Sri.Jose Joseph, SC, GOI (Taxes) JUDGMENT Vinod Chandran, J: The Revenue is in appeal against the orders passed by the Tribunal, wherein the issue dealt with was identical and falls on an interpretation of Section 2(22)(e) of the Income Tax Act, 1961 [for brevity the Act ], which is extracted hereunder: 2(22)(e) any payment by a company, not being a company in which the public are substantially interested, of any sum (whether as representing a part of the assets of the company or otherwise) made after the 31st day of May, 1987, by way of advance or loan to a shareholder, being a person who is the beneficial owner of shares (not being shares entitled to a fixed rate of divid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n M/s.Aromatic Ingredients Pvt. Ltd., which is the assessee at whose hands the amounts were taxed as dividend, relying on the fiction under Section 2(22)(e) of the Act. In I.T.A.No.113 of 2015, the Chairman of one M/s.Network Systems Technologies P. Ltd. had more than 10% share holding in M/s.Sunfibre Optics Pvt. Ltd., the latter of whom advanced an amount of ₹ 1,93,33,974/- to the assessee-Company. The Assessing Officer rejected the contention of both the assessees that there could be no taxation of the said amounts deeming it to be a dividend at the hands of the assessee, since the assessee is not the shareholder of the other Company. 3. The dividend could be taxed only in the hands of the shareholder, was the contention raised ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment by the Company on behalf, or for the individual benefit, of such shareholder. The amounts so paid being deemed to be a dividend, could be taxed only at the hands of the shareholder was the specific finding in Ankitech Pvt. Ltd. 5. Ankitech Pvt. Ltd. and National Travel Services were authored by the same learned Judge [as His Lordship then was]. In National Travel Services a different situation was considered insofar as the concern in which the shareholder had substantial interest was a partnership firm. The partnership firm was assessed and the objection taken was that the shares were purchased in the name of the partners and hence the firm, though the beneficial owner, was not the shareholder. Assessment could be m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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