22 October 2010
Another very peculiar situation. As per rule it should be treated as deemed dividend u/s 2(22)(e). But the loan given say Rs. 1 lac is adjusted against dividend declared Rs. 1 lac. In my view only Rs 1 lac will be taxable. Views of other experts also solicited.
23 October 2010
Loan to shareholder is deemed dividend u/s 2(22)(e) - not liable to DDT u/s 115O but taxable in the hands of shareholder even if the same is repaid during the year
Dividend declared later u/s 2(22)(a) - liable to DDT and exempt for shareholder u/s 10(34)
Adjustment/ set off will not alter the applicability of above
CAclubindia
