Deemed dividend

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

14 September 2012 If Director of pvt company taken and given loan to company does it attract 2(22)e ?

and he holds more than 10% shars.

Amol S Joglekar

Amol S Joglekar (Expert)
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14 September 2012 Yes, definitely it attracts the dividend section.

swasti

swasti (Expert)
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14 September 2012 Sir, I think that if the director of the company is also a shareholder & gives loan to the company, then it does not attract dividend section. But if the company gives loan to a shareholder(director)who holds more than 10%, then only 2(22)(e) applies.

Please correct me if i am wrong.

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Amol S Joglekar

Amol S Joglekar (Expert)
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15 September 2012 you are absolutely right SWASTI. MY contention was in case of pvt company... director giving and taking loan from/to company.... has to be a member. Else 58A may be attracted.

Querist : Anonymous

Querist : Anonymous (Querist)

16 September 2012 but it says subject to accumulated profits what is that ? and it says loan given is for business purpose then is okk

plz tell

swasti

swasti (Expert)
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17 September 2012 Thanks Amol Sir. I fully agree with you.