The Tax Publishers2020 TaxPub(DT) 3462 (Del-Trib)

INCOME TAX ACT, 1961

Section 2(22)(e)

Where documents produced before AO by assessee established that amount was received in ordinary course of business for purchase of land and against assignment of development rights in land and did not fall within purview of provision of section 2(22)(e), same was not applicable to case of assessee it was normal business transaction benefitting both payer and payee.

Dividend - Deemed dividend under section 2(22(e) - Applicability of provision - Amount received in ordinary course of business for purchase of land and against assignment of development rights in land

Assessee was aggrieved by addition made of amount was received by builders in ordinary course of business for purchase of land and against assignment of development rights in land. Case of assessee was that transaction did not fall within purview of provision of section 2(22)(e), as held by AO. Held: Documents produced before AO established that amount was received in ordinary course of business for purchase of land and against assignment of development rights in land and did not fall within purview of provision of section 2(22)(e). Facts were not disputed by revenue at any point of time. Nothing was established against assessee for application of section 2(22)(e) on ground that amount advance was for purchase of suitable land and said amount was shown in its balance sheet as current liability. Assessee gave all details but same were not at all taken into account in context of applicability of section 2(22)(e). Section 2(22)(e) will not be applicable in assessee's case as same is not applicable, where loans and advances are given in normal course of business and transaction in question benefits both payer and payee companies.

Followed:CIT v. Ankitech Pvt Ltd. & Others (2011) 11 taxmann.com 100 (Delhi)

REFERRED : CIT v. Creative Dyeing & Printing Pvt. Ltd. (2009) 184 Taxman 483(Delhi) : 2009 TaxPub(DT) 2060 (Del-HC) CIT v. Ambassador Travels P. Ltd. (2008) 173 Taxmann 407 (Del.) : 2009 TaxPub(DT) 0483 (Del-HC)

FAVOUR : In assessee's favour

A.Y. : 2011-12

INCOME TAX ACT, 1961

Section 2(22)(e)

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