06 March 2009
Loan to a closely held co. to the extend of reserves is taxable as deemed dividend in the hands of recepient. My query is whether in case where reserves consists of only share premium and no ther profit can loan given be added as deemed dividend.
06 March 2009
Dear Hiren, As per 2(22)_a/b/c/d/e we have to consider accumulated profit, which includes credit balance of P&L, GR, Investment Allowance reserve, Capitalisation profit and profit for the year upto date of distribution / liquidation.
CAclubindia
