CIT v. P.K. Abubucker (Mad)

259 ITR 507High Court2003#6608 most cited

What is CIT v. P.K. Abubucker (Mad) authority for?

The assessee bears the burden of proving that a transaction was a business advance and not a loan, particularly concerning Section 2(22)(e) of the Income Tax Act. Loans given to a shareholder for property purchase are taxable under Section 2(22)(e), even if repaid later.

17

judgments rely on this decision, according to BharatTax’s citation analysis of 366,421 Indian tax judgments — from 2016 to 2025.

Also referred to as

CIT v. P.K. Abubucker · 259 ITR 507 · Section 2(22)(e) · deemed dividend · business advance · loan · burden of proof · shareholder

Sections most often in play

Section 132(1)Section 143(3)Section 147Section 148Section 153ASection 2(22)(e)

Judgments citing CIT v. P.K. Abubucker (Mad)

Ajay Bakliwal, Kota vs. ACIT, Central Circle, Kota

In the result, the appeal of the assessee is allowed

ITA 1275/JPR/2024[2012-13]Status: DisposedITAT Jaipur11 Apr 2025AY 2012-13
For Appellant: Sh. Rajendra Sisodia, AdvFor Respondent: Mrs. Anita Rinesh, JCIT-DR
Section 129Section 132(1)Section 139Section 142Section 143(2)Section 143(3)Section 147Section 148Section 153ASection 2(22)(e)

…al Precedents Supporting Revenue's Stand • CIT v. Mukundray K. Shah [(2007) 290 ITR 433 (SC)]: The Supreme Court held that advances to concerns in which a shareholder has substantial interest are covered under Section 2(22)(e). • CIT v. P.K. Abubucker [(2003) 259 ITR 507 (Mad)]: The burden of proving that a transaction is a business advance and not a loan lies on the assessee. 3. 5. Errors in the Appellant's Arguments • The Appellant's claim that the loans were taken by him in his individual capacity is contradicted by the books of accounts of M/s Millenium Technocrat Colonizers Pvt. Ltd., which record the amoun…

ACIT, Non Corp CIT 7(1), Chennai vs. Jethanand Thakur Bakshani, Chennai

In the result, the Revenue’s appeal is

ITA 883/CHNY/2019[2014-15]Status: DisposedITAT Chennai25 Feb 2020AY 2014-15

Bench: Shri N.R.S. Ganesan & Shri S. Jayaraman

For Appellant: Shri. AR.V. Sreenivasan, JCITFor Respondent: Shri. M. Karunakaran, Advocate
Section 2(22)(e)Section 24

…me Tax (Appeals) be set aside and that of the Assessing Officer be restored.” The ld DR presented the case on the above lines and relied on the decisions of Supreme Court in the case of Smt. Tarulata Shyam vs CIT 108 ITR 345 (SC) and CIT vs. P.K. Abubucker, 259 ITR 507 (Mad) and pleaded to restore the order of the AO . 3. Per contra, the ld AR submitted that the assessee was then carrying on business as manufacturer and exporter of garments individually under the name and style of BNT Connections. He is a substantial shareholder of M/s (“company”). The company is carrying on business as Manufacturer and ex…

Asian Business Conection Pvt. Ltd., Bhopal vs. DCIT - 1(1), Bhopal

ITA 936/IND/2018[2015-16]Status: DisposedITAT Indore25 Sept 2019AY 2015-16

Bench: Hon'Ble Kul Bharat & Hon'Ble Manish Boradassessment Year 2015-16 M/S. Asian Business Dcit-1(1), Connections Private Ltd, Vs. Bhopal Fm-18, Man Sarovar Complex, 7No. Stop, Shivaji Nagar, Bhopal (Appellant) (Respondent ) Pan No.Aaica1206D

Section 139(1)Section 143(2)Section 143(3)Section 2Section 2(22)Section 2(22)(e)Section 35D

…ncome-tax Vis. P.K. Abubucker [2004] 56 Asian Business Connection Private Limited 135 Taxman 77 (Madras) • Income-tax Officer Vis. Ajanta Cycles (P.) Ltd. [2008] 22 SOT 1 (Chandigarh) • CIT Vis. Arati Debi 111 ITR 277 (Cal.) • CIT Vs P.K. Abubucker (Mad) 259 ITR 507 • Mayur Madhukant Mehta 85 ITR 230 (GUj) 46. In view of the facts and circumstances of the case and legal position, it is concluded that the amount of Rs. 429.50 crore given by AOPL to ABC was a transaction squarely covered u/s 2(22)(e) of the Act. The A.O. has rightly restricted the addition in Rs.297,74,68,364/- to the extent of accumulated re…

Dr.L.Saravanan, Chennai vs. ITO Corporate Ward 1(1), Chennai

In the result, all the appeals filed by Dr

ITA 1619/CHNY/2018[2010-11]Status: DisposedITAT Chennai29 Oct 2018AY 2010-11

Bench: Shri George Mathan & Shri A.Mohan Alankamony

For Appellant: Mr.S.Sridhar,AdvocateFor Respondent: Mr.Clement Ramesh Kumar
Section 2(22)(e)Section 40A(3)

…aravanan of the Co-ordinate Bench of the Tribunal in the case of M/s.CAI Industries P Ltd., referred to supra. 6. In reply, ld.D.R submitted that the decision of the Hon’ble jurisdictional High Court in the case of CIT Vs.P.K.Abubacker reported in [2003] 259 ITR 507(Madras) would apply as advances had been taken by the shareholder for the construction of the building, which was later taken on lease by the company and such advance was set off against the future rent. Ld.D.R also placing reliance in the decision of the Hon’ble jurisdictional High Court in the case of Sunil Kapoor Vs. CIT reported in [2015] 2…

Dr.L.Saravanan, Chennai vs. ITO Corporate Ward 1(1), Chennai

In the result, all the appeals filed by Dr

ITA 1618/CHNY/2018[2009-10]Status: DisposedITAT Chennai29 Oct 2018AY 2009-10

Bench: Shri George Mathan & Shri A.Mohan Alankamony

For Appellant: Mr.S.Sridhar,AdvocateFor Respondent: Mr.Clement Ramesh Kumar
Section 2(22)(e)Section 40A(3)

…aravanan of the Co-ordinate Bench of the Tribunal in the case of M/s.CAI Industries P Ltd., referred to supra. 6. In reply, ld.D.R submitted that the decision of the Hon’ble jurisdictional High Court in the case of CIT Vs.P.K.Abubacker reported in [2003] 259 ITR 507(Madras) would apply as advances had been taken by the shareholder for the construction of the building, which was later taken on lease by the company and such advance was set off against the future rent. Ld.D.R also placing reliance in the decision of the Hon’ble jurisdictional High Court in the case of Sunil Kapoor Vs. CIT reported in [2015] 2…

Dr.L.Saravanan, Chennai vs. ITO Corporate Ward 1(1), Chennai

In the result, all the appeals filed by Dr

ITA 1617/CHNY/2018[2008-09]Status: DisposedITAT Chennai29 Oct 2018AY 2008-09

Bench: Shri George Mathan & Shri A.Mohan Alankamony

For Appellant: Mr.S.Sridhar,AdvocateFor Respondent: Mr.Clement Ramesh Kumar
Section 2(22)(e)Section 40A(3)

…aravanan of the Co-ordinate Bench of the Tribunal in the case of M/s.CAI Industries P Ltd., referred to supra. 6. In reply, ld.D.R submitted that the decision of the Hon’ble jurisdictional High Court in the case of CIT Vs.P.K.Abubacker reported in [2003] 259 ITR 507(Madras) would apply as advances had been taken by the shareholder for the construction of the building, which was later taken on lease by the company and such advance was set off against the future rent. Ld.D.R also placing reliance in the decision of the Hon’ble jurisdictional High Court in the case of Sunil Kapoor Vs. CIT reported in [2015] 2…

Dr.S.Mahalakshmi, Chennai vs. ITO Corporate Ward 1(1), Chennai

In the result, all the appeals filed by Dr

ITA 1616/CHNY/2018[2012-13]Status: DisposedITAT Chennai29 Oct 2018AY 2012-13

Bench: Shri George Mathan & Shri A.Mohan Alankamony

For Appellant: Mr.S.Sridhar,AdvocateFor Respondent: Mr.Clement Ramesh Kumar
Section 2(22)(e)Section 40A(3)

…aravanan of the Co-ordinate Bench of the Tribunal in the case of M/s.CAI Industries P Ltd., referred to supra. 6. In reply, ld.D.R submitted that the decision of the Hon’ble jurisdictional High Court in the case of CIT Vs.P.K.Abubacker reported in [2003] 259 ITR 507(Madras) would apply as advances had been taken by the shareholder for the construction of the building, which was later taken on lease by the company and such advance was set off against the future rent. Ld.D.R also placing reliance in the decision of the Hon’ble jurisdictional High Court in the case of Sunil Kapoor Vs. CIT reported in [2015] 2…

Dr.S.Mahalakshmi, Chennai vs. ITO Corporate Ward 1(1), Chennai

In the result, all the appeals filed by Dr

ITA 1615/CHNY/2018[2011-12]Status: DisposedITAT Chennai29 Oct 2018AY 2011-12

Bench: Shri George Mathan & Shri A.Mohan Alankamony

For Appellant: Mr.S.Sridhar,AdvocateFor Respondent: Mr.Clement Ramesh Kumar
Section 2(22)(e)Section 40A(3)

…aravanan of the Co-ordinate Bench of the Tribunal in the case of M/s.CAI Industries P Ltd., referred to supra. 6. In reply, ld.D.R submitted that the decision of the Hon’ble jurisdictional High Court in the case of CIT Vs.P.K.Abubacker reported in [2003] 259 ITR 507(Madras) would apply as advances had been taken by the shareholder for the construction of the building, which was later taken on lease by the company and such advance was set off against the future rent. Ld.D.R also placing reliance in the decision of the Hon’ble jurisdictional High Court in the case of Sunil Kapoor Vs. CIT reported in [2015] 2…

Dr.S.Mahalakshmi, Chennai vs. ITO Corporate Ward 1(1), Chennai

In the result, all the appeals filed by Dr

ITA 1614/CHNY/2018[2010-11]Status: DisposedITAT Chennai29 Oct 2018AY 2010-11

Bench: Shri George Mathan & Shri A.Mohan Alankamony

For Appellant: Mr.S.Sridhar,AdvocateFor Respondent: Mr.Clement Ramesh Kumar
Section 2(22)(e)Section 40A(3)

…aravanan of the Co-ordinate Bench of the Tribunal in the case of M/s.CAI Industries P Ltd., referred to supra. 6. In reply, ld.D.R submitted that the decision of the Hon’ble jurisdictional High Court in the case of CIT Vs.P.K.Abubacker reported in [2003] 259 ITR 507(Madras) would apply as advances had been taken by the shareholder for the construction of the building, which was later taken on lease by the company and such advance was set off against the future rent. Ld.D.R also placing reliance in the decision of the Hon’ble jurisdictional High Court in the case of Sunil Kapoor Vs. CIT reported in [2015] 2…

Dr.L.Saravanan, Chennai vs. ITO Corporate Ward 1(1), Chennai

In the result, all the appeals filed by Dr

ITA 1622/CHNY/2018[2013-14]Status: DisposedITAT Chennai29 Oct 2018AY 2013-14

Bench: Shri George Mathan & Shri A.Mohan Alankamony

For Appellant: Mr.S.Sridhar,AdvocateFor Respondent: Mr.Clement Ramesh Kumar
Section 2(22)(e)Section 40A(3)

…aravanan of the Co-ordinate Bench of the Tribunal in the case of M/s.CAI Industries P Ltd., referred to supra. 6. In reply, ld.D.R submitted that the decision of the Hon’ble jurisdictional High Court in the case of CIT Vs.P.K.Abubacker reported in [2003] 259 ITR 507(Madras) would apply as advances had been taken by the shareholder for the construction of the building, which was later taken on lease by the company and such advance was set off against the future rent. Ld.D.R also placing reliance in the decision of the Hon’ble jurisdictional High Court in the case of Sunil Kapoor Vs. CIT reported in [2015] 2…

Dr.L.Saravanan, Chennai vs. ITO Corporate Ward 1(1), Chennai

In the result, all the appeals filed by Dr

ITA 1621/CHNY/2018[2012-13]Status: DisposedITAT Chennai29 Oct 2018AY 2012-13

Bench: Shri George Mathan & Shri A.Mohan Alankamony

For Appellant: Mr.S.Sridhar,AdvocateFor Respondent: Mr.Clement Ramesh Kumar
Section 2(22)(e)Section 40A(3)

…aravanan of the Co-ordinate Bench of the Tribunal in the case of M/s.CAI Industries P Ltd., referred to supra. 6. In reply, ld.D.R submitted that the decision of the Hon’ble jurisdictional High Court in the case of CIT Vs.P.K.Abubacker reported in [2003] 259 ITR 507(Madras) would apply as advances had been taken by the shareholder for the construction of the building, which was later taken on lease by the company and such advance was set off against the future rent. Ld.D.R also placing reliance in the decision of the Hon’ble jurisdictional High Court in the case of Sunil Kapoor Vs. CIT reported in [2015] 2…

Dr.L.Saravanan, Chennai vs. ITO Corporate Ward 1(1), Chennai

In the result, all the appeals filed by Dr

ITA 1620/CHNY/2018[2011-12]Status: DisposedITAT Chennai29 Oct 2018AY 2011-12

Bench: Shri George Mathan & Shri A.Mohan Alankamony

For Appellant: Mr.S.Sridhar,AdvocateFor Respondent: Mr.Clement Ramesh Kumar
Section 2(22)(e)Section 40A(3)

…aravanan of the Co-ordinate Bench of the Tribunal in the case of M/s.CAI Industries P Ltd., referred to supra. 6. In reply, ld.D.R submitted that the decision of the Hon’ble jurisdictional High Court in the case of CIT Vs.P.K.Abubacker reported in [2003] 259 ITR 507(Madras) would apply as advances had been taken by the shareholder for the construction of the building, which was later taken on lease by the company and such advance was set off against the future rent. Ld.D.R also placing reliance in the decision of the Hon’ble jurisdictional High Court in the case of Sunil Kapoor Vs. CIT reported in [2015] 2…

Ashish Dham, Delhi vs. DCIT, New Delhi

In the result, the appeal of the assessee stands dismissed

ITA 6607/DEL/2014[2007-08]Status: DisposedITAT Delhi30 May 2018AY 2007-08

Bench: Shri Pramod Kumar & Shri Sudhanshu Srivastavaassessment Year: 2007-08

For Appellant: Shri Pratap Gupta, CAFor Respondent: Shri Ravi Kant Gupta, Sr. DR
Section 2(22)(e)

…fact that the assessee in the eyes of law had received dividend from the company during the relevant accounting year. This judgment of the Hon’ble Apex Court was also followed by the Hon’ble Madras High Court in the case of CIT vs. P.K. Aboobaker reported in 259 ITR 507 (Madras) wherein the Hon’ble Madras High Court was adjudicating the applicability of provisions of section 2(22)(e) with respect to advance given to a shareholder for purchase of property and the Hon’ble Madras High Court went on to hold that the loan given for purchase of property was taxable u/s 2(22)(e) of the Act . In the present case also…

Chandra Ramesh, Chennai vs. ACIT(OSD), Chennai

In the result, the assessee’s appeal is allowed

ITA 273/CHNY/2017[2007-08]Status: DisposedITAT Chennai23 Apr 2018AY 2007-08

Bench: Shri Duvvuru Rl Reddy & Shri S. Jayaraman

For Appellant: Shri. B. Ramakrishnan, FCA
Section 143(3)Section 147Section 2(22)(e)Section 271(1)(c)

…particulars and hence, the penalty levied may be deleted. Per contra, the DR supported the orders of the lower authorities and relied on the decision of the Bombay High Court in the case of CIT vs Alkes K Patel 325 ITR 118 (Bom) and CIT vs P.K. Abubucker 259 ITR 507 (Mad) and submitted that impugned transaction clearly falls within the scope of section 2(22)(e). 4. We heard the rival submissions and gone through the relevant material. The fact remains that the assessee has disclosed the receipt of rent and the security deposit from the company in the return, on the basis of which the Assessing Officer has…

Sh. Harish Kanwar, New Delhi vs. ITO, New Delhi

In the result, the Appeal of the is allowed for statistical

ITA 529/DEL/2017[2011-12]Status: DisposedITAT Delhi18 Oct 2017AY 2011-12

Bench: Shri H.S. Sidhu & Shri L.P. Sahu

For Appellant: Sh. Ved Jain, CAFor Respondent: Sh. Arun Kumar Yadav, Sr. DR
Section 143(1)Section 143(2)Section 2(22)(e)Section 54

…d dividends paid on dates when withdrawals were allowed to be made and subsequent adjustment of account made on very last day of accounting year would not alter position that assessee received notional dividends on various dates. 2. CIT Vs. P. K. Abubucker 259 ITR 507 (Mad): In this case the assessee had leased out on monthly rent the ground floor of a building to a company in which he had substantial interest and at the same time taken an advance /loan of Rs. 10 lacs from the company for the purpose of construction of upper floors. This advance was to be adjusted against the rent accruing in the future mon…

Libra (Agencies ) P.Ltd, Mumbai vs. DCIT 1(2), Mumbai

ITA 81/MUM/2014[2007-08]Status: DisposedITAT Mumbai15 Mar 2017AY 2007-08
For Appellant: Ms. Mrugakshi JoshiFor Respondent: Shri Kailash P. Gaikwad
Section 143(3)Section 2(22)(e)Section 254(1)

…e amount was shown as temporary loan, that the nature of the transaction was of loan, that the advances received by the assessee from its subsidiary for sale of fixed assets was covered by the provisions of Sec.2(22)(e).He referred to the case of P K Abubekar(259 ITR 507) and confirmed the order of the AO. 4.During the course of hearing before us, the Authorised Representative (AR) contended that the subsidiary company agreed to purchase assets like land, building, furniture and fixtures, plant and machinery together with goodwill for a consideration of Rs. 5.14 crore, that out of the said amount in advance of Rs…

ITO, Ward - 10(2), Kolkata vs. Magnum Clothing (P) Ltd., Kolkata

In the result, Revenue’s appeal stands partly allowed for statistical purpose

ITA 1352/KOL/2006[2002-03]Status: DisposedITAT Kolkata19 Apr 2016AY 2002-03

Bench: Shri N.V.Vasusdevan & Shri Waseem Ahmedassessment Year :2002-03 Ito, Ward-10(2), 3 V/S. Magnum Clothing (P) Ltd. Govt. Place (West), C/O Chopra & Company, Kolkata-700 001 Chartered Accountants, Chopra House, 133, Canning Street, Kolkata-700 001 [Pan No.Aaccm 0783 F]

Section 143(3)Section 92Section 92C

…vidend income of the assessee company not sustainable as per law. His decision is in apparent variance to the decision of the apex court in the case of P. Sarada Vs. CIT reported in 229 ITR 444 and of the Madras High Court in CIT Vs. P.K.Abubucker reported in 259 ITR 507.” 2. The effective ground no. 1 to 4 are inter-connected and hence same is clubbed together for the sake of convenience is that Ld. CIT(A) erred in deleting the addition made by TPO on account of transfer pricing adjustment. 3. Facts in brief as culled out from the records are that the assessee in the present case is a private limited company a…

CIT v. P.K. Abubucker (Mad) (259 ITR 507) — Cited in 17 Judgments | BharatTax