sec 2(22)(e)

This query is : Resolved

manish (Querist)
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05 August 2009 a company paid our share holder advance,as per I-Tax law it is deemed to be dividend and taxable in the hands of shareholders .
so 1. can company deduct TDS U/s 115-O or not 2.when shareholder repaid that advance what should be treatment in companies books as per both of laws.

Aditya Maheshwari

Aditya Maheshwari (Expert)
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05 August 2009 TDS will be deductible u/s 194. When loan is repaid normal entries in both the books will be there. No special accounting treating.

Though the said amount has been taxed as dividend in the hands of the shareholder the same will be treated as a lon in the books and the shareholder will be liable to repay the same.

This is the worst part of the section. You have an income but cannot keep it.

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