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Section 2(22)(e)

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Querist : Anonymous

Querist : Anonymous (Querist)

01 December 2011 If a company has given an advance to a director holding substantial interest in the company, but that advance is given for purchasing a property for company's business operations, but the deal didnt materialized and the advance was returned at the year end. Considering that other conditions of the section are satisfied, whether the advance will be considered as deemed dividend? Please give the relevant case laws too if section 2(22) (e) is not applicable?

CS, Deepak Pratap Singh

CS, Deepak Pratap Singh (Expert)

02 December 2011 The advance given by the company was for the purpose of the company and for its own benefit. The provisions of Section 2(22)(e) will not applied in this case and the advance will not be considered as deemed dividend in the hand of Director Shareholder.

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Querist : Anonymous

Querist : Anonymous (Querist)

07 December 2011 thank you very much sir... please tell me if there are any relevant case laws...

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