deemed dividend

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43 Points Joined August 2018
when a company A gives loan to company B and company B is a stake holder of more than 10% in company A. can this loan be termed as deemed dividend u/s 2 22 e in the hands of B. urgent reply is solicited....thanks in advance
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On 08 January 2019 at 12:36 Report
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intermediate
216 Points Joined April 2014
Deemed dividend provisions are applicable only to closely held companies (i.e., companies in which public are not substantially interested).

So please ensure that the same is not public company before treating the same is deemed dividend.
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On 09 January 2019 at 00:01
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43 Points Joined August 2018
yes company B is a private company
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On 09 January 2019 at 10:20
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Partner at Bhat Momaya & Associates
2319 Points Joined November 2016

The reserves of Company A as on the date of grant of loan has also to be taken into account before treating the same as deemed dividend u/s 2(22)(e)

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On 09 January 2019 at 10:43


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