13 March 2013
MR. X Is Share Holder In XYZ Pvt. Ltd. & there Holding Is 30% & he is Also Partner in a Partnership Firm upto 50% Company gives Advance of Rs 150000 to Such Partnership Firm For The Purchase of Raw Material. A.O. Make An Assessment & taxed it U/S 2 (22) (e) Deemed Dividend
Please Suggest me Relevant Case law against such assessment
13 March 2013
Trade advance for purchases is not a deemed dividend. Raj Kumar's case reported in 181 Taxman 155 can be relied. It is a Delhi high Court decision.