“section 2(22)(e)”

Special Rate ProvisionsSection 2(22)(e)Section 2(22)(e)751 judgments

The decision most relied on for section 2(22)(e) is CIT v. Winsome Textile Industries Ltd. (319 ITR 204), cited in 378 judgments on BharatTax.

Leading authorities on section 2(22)(e)

CIT v. Winsome Textile Industries Ltd.

319 ITR 204 · 2009 · High Court

378

citing judgments

Section 14A of the Income-tax Act, 1961, which disallows expenditure incurred in relation to exempt income, is not applicable if the assessee has not earned any exempt income in the relevant assessment year.

CIT v. Ankitech (P) Ltd.

340 ITR 14 · 2012 · High Court

202

citing judgments

Deemed dividend under section 2(22)(e) cannot be taxed in the hands of a non-shareholder. The Supreme Court confirmed this view, affirming the Delhi High Court's decision in Ankitech.

DCIT v. Core Health Care Ltd.

298 ITR 194 · 2008 · Supreme Court

165

citing judgments

Interest expenditure incurred for acquiring capital assets, even if capitalized in the books, is deductible if for the purpose of business. Section 36(1)(iii) is a self-contained code regarding such deductions.

Pradip Kumar Malhotra v. CIT

338 ITR 538 · 2011 · High Court

152

citing judgments

Section 2(22)(e) of the Income Tax Act, which addresses deemed dividends, does not apply to loans or advances provided by a company to its shareholders if these transactions occur in the normal course of business, are driven by business expediency, or are made in consideration of a benefit conferred upon the company by the shareholder. Conversely, gratuitous loans or advances given to shareholders fall within the purview of this section.

Jamshedpur Motor Accessories Stores v. CIT

72 ITR 612 · 1969 · Supreme Court

140

citing judgments

The reasonableness of an expenditure for business purposes must be assessed from the businessman's perspective, not the revenue's, and the primary motive to earn income directly is not a prerequisite for its admissibility as a deduction.

H T Media Ltd. v. PCIT

399 ITR 576 · 2017 · High Court

132

citing judgments

The Assessing Officer must first record satisfaction that the assessee’s claim regarding expenditure incurred for earning exempt income is incorrect or unreasonable before applying the provisions of Rule 8D to determine such disallowance under Section 14A(2) of the Income Tax Act.

CIT v. Creative Dyeing & Printing Pvt. Ltd.

318 ITR 476 · 2009 · High Court

119

citing judgments

Genuine trade advances or amounts advanced for bona fide business transactions, driven by commercial expediency, do not fall within the definition of deemed dividend under section 2(22)(e) of the Income-tax Act.

CIT v. Raj Kumar

318 ITR 462 · 2009 · High Court

119

citing judgments

Genuine trade advances made by a company in the ordinary course of business to a shareholder do not fall within the definition of deemed dividend under Section 2(22)(e) of the Income-tax Act.

Judgments citing section 2(22)(e)

Asha Burman, New Delhi vs. ACIT Circle 46(1), New Delhi

In the result, appeals of the Assessee are partly allowed for

ITA 541/DEL/2024[AY 2014-15]Status: DisposedITAT Delhi04 Nov 2025

Bench: Shri Challa Nagendra Prasad & Shri Avdhesh Kumar Mishraआ.अ.सं/.I.T.A Nos.539 To 544/Del/2024 िनधा"रणवष"/Assessment Years:2012-13 To 2017-18 बनाम Asha Burman Acit, 4Th Floor, Punjabi Bhawan, Vs. Circle 46(1), 10, Rouse Avenue, New Delhi. Drum Shape Building, Ito, Pan No.Aaepb0966C New Delhi. अपीलाथ" Appellant ""यथ"/Respondent

Section 143(3)Section 24

ITA Nos.539 to 544/Del/2024 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A” NEW DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD

Asha Burman, New Delhi vs. ACIT Circle 46(1), New Dlehi

In the result, appeals of the Assessee are partly allowed for

ITA 540/DEL/2024[AY 2013-14]Status: DisposedITAT Delhi04 Nov 2025

Section 143(3)Section 24

ITA Nos.539 to 544/Del/2024 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A” NEW DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD

DCIT Circle 2.3.1, Mumbai vs. Prestige Holiday Resorts Private Limited, Mumbai

In the result, ground no. 2 and 3 are

ITA 4162/MUM/2025[2016-17]Status: DisposedITAT Mumbai28 Oct 2025AY 2016-17

Bench: Shri Pawan Singh& Shri Arun Khodpia

Section 2(11)Section 2(22)(e)Section 253(3)Section 254(1)

weeks, entered into with its subsidiaries Regal Vacation Concepts Private Limited and Royal International Holiday Club (India) Private Limited as deemed dividend under section 2(22)(e) of the Act. (2) Whether on facts and circumstances of the case, the CIT(A) erred in allowing commission expenses amounting to Rs.3.43 ... assessee is utilising the advances / loan in the form of purchase of time share weeks. Such transaction is hit by provisions of section 2(22)(e) of the Act. On the basis of such adverse observation, the AO issued show cause notice dated 16/12/2018. Details of show cause notice

DCIT Circle 2.3.1, Mumbai vs. Prestige Holiday Resorts Private Limited, Mumbai

In the result, ground no. 2 and 3 are

ITA 4161/MUM/2025[2015-16]Status: DisposedITAT Mumbai28 Oct 2025AY 2015-16

Bench: Shri Pawan Singh& Shri Arun Khodpia

Section 2(11)Section 2(22)(e)Section 253(3)Section 254(1)

Sh. Sukhvinder Singh, Kanpur vs. Pr CIT, Central, Kanpur

ITA 191/LKW/2020[2014-15]Status: DisposedITAT Lucknow17 Oct 2025AY 2014-15

Bench: Shri Kul Bharat & Shri Anadee Nath Misshra

For Appellant: Shri Samrat Chandra, C.AFor Respondent: Shri R. K. Agarwal, CIT(DR)

Section 263

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH “A”, LUCKNOW BEFORE SHRI KUL BHARAT, VICE PRESIDENT AND SHRI ANADEE NATH

Sh. Sukhvinder Singh, Kanpur vs. Pr CIT, Central, Kanpur

In the result, both appeals filed by the assessee are allowed for statistical purposes

ITA 190/LKW/2020[2012-13]Status: DisposedITAT Lucknow17 Oct 2025AY 2012-13

Bench: Shri Kul Bharat & Shri Anadee Nath Misshra

For Appellant: Shri Samrat Chandra, C.AFor Respondent: Shri R. K. Agarwal, CIT(DR)

Section 263

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH “A”, LUCKNOW BEFORE SHRI KUL BHARAT, VICE PRESIDENT AND SHRI ANADEE NATH

Ramsamy Pongianna Gounder Desamani, Pallipalayam vs. Itd, Ward 2, Tiruchengode

ITA 2438/CHNY/2024[2011-12]Status: DisposedITAT Chennai16 Oct 2025AY 2011-12

Bench: Shri S.S. Viswanethra Ravi & Shri S. R. Raghunathaआयकर अपील सं./Ita No.:2438/Chny/2024 निर्धारण वर्ष / Assessment Year: 2011-12 Late. Ramasamy Pongianna Gounder Desamani, (Represented By Legal Heir Shri. P.D.Balachandhran) 79, R.P.Street, Sankari Bye-Pass Road, R.P.Street,\Pallipalayam – 638 006. [Pan:Acqpd-3208-H] (अपीलार्थी/Appellant) Ito, Vs. Ward -2, Tiruchengode. (प्रत्यर्थी/Respondent) अपीलार्थी की ओर से/Appellant By प्रत्यर्थी की ओर से/Respondent By : Shri. T. S. Lakshmi Venkataraman, F.C.A. : Ms. Gauthami Manivasagam, J.C.I.T. सुनवाई की तारीख/Date Of Hearing घोषणा की तारीख/Date Of Pronouncement : 09.09.2025 : 16.10.2025 आदेश /Order Per S. R. Raghunatha, Am: This Appeal Filed By The Assessee Is Directed Against The Order Passed By The Learned Commissioner Of Income Tax (Appeals), National Faceless Appeal Centre (Nfac), Delhi, [Herein After “Ld. Cit(A)] Dated 16.07.2024 & Pertains To Assessment Year 2011-12. :-2-:

For Respondent: Shri. T. S. Lakshmi Venkataraman, F.C.A

Section 139Section 147Section 148Section 151Section 2(22)(e)Section 250

circumstances of the case the AO is not justified in assessing a sum of Rs.1,79,52,270/- by invoking the provisions of section 2(22)(e) of the Act in assessing the above amount as deemed dividend which has been upheld by the First appellate authority ... 2438/Chny/2024 basis, the AO concluded that since the assessee's shareholding and voting rights in the respective companies exceeded 10%, the provisions of section 2(22)(e) of the Act, were attracted. The AO further held that the assessee, being both a significant shareholder and a beneficiary of the loans

Deputy Commissioner of Income-Tax, Central Circle-3, Jaipur vs. Sapna Karnani, Tonk Phatak

In the result, the appeals of the revenue in ITA No

ITA 712/JPR/2025[2017-18]Status: DisposedITAT Jaipur14 Oct 2025AY 2017-18

For Appellant: Shri Deepak Sharma, CAFor Respondent: Ms. Alka Gautam, CIT, DR

Section 127Section 139(1)Section 153ASection 153CSection 68Section 69C

already disclosed or made known in course of original assessment and since there was no incriminating material or facts/circumstances justifying additions made under section 2(22)(e), Tribunal was justified in deleting addition. After hearing counsel for the parties and considering the grounds urged in support of the Revenue ... assessment can be made. In the present case, the Revenue does not urge that it discovered any new material justifying the addition under section 2(22)(e). Rather, there was no material to connect the additions made under that head. Clearly, there was no incriminating material or facts and circumstances

Deputy Commissioner of Income-Tax, Central Circle-3, Jaipur vs. Sapna Karnani, Tonk Phatak

ITA 711/JPR/2025[2016-17]Status: DisposedITAT Jaipur14 Oct 2025AY 2016-17

Bench: DR. S. SEETHALAKSHMI (Judicial Member)

For Appellant: Shri Deepak Sharma, CAFor Respondent: Ms. Alka Gautam, CIT, DR

Section 127Section 139(1)Section 153ASection 153CSection 68Section 69C

Deputy Commissioner of Income-Tax, Central Circle-3, Jaipur vs. Sapna Karnani, Tonk Phatak

In the result, the appeals of the revenue in ITA No

ITA 710/JPR/2025[2014-15]Status: DisposedITAT Jaipur14 Oct 2025AY 2014-15

For Appellant: Shri Deepak Sharma, CAFor Respondent: Ms. Alka Gautam, CIT, DR

Section 127Section 139(1)Section 153ASection 153CSection 68Section 69C

Deputy Commissioner of Income-Tax, Central Circle-3, Jaipur vs. Sapna Karnani, Tonk Phatak

In the result, the appeals of the revenue in ITA No

ITA 709/JPR/2025[2013-14]Status: DisposedITAT Jaipur14 Oct 2025AY 2013-14

For Appellant: Shri Deepak Sharma, CAFor Respondent: Ms. Alka Gautam, CIT, DR

Section 127Section 139(1)Section 153ASection 153CSection 68Section 69C

Deputy Commissioner of Income-Tax, Central Circle-3, Jaipur vs. Karnani Solvex Private Limited, Jaipur

In the result, the appeals of the revenue in ITA No

ITA 480/JPR/2025[2014-15]Status: DisposedITAT Jaipur13 Oct 2025AY 2014-15

For Appellant: Shri Deepak Sharma, CAFor Respondent: MS. Alka Gautam, CIT

Section 127Section 132(4)Section 153ASection 68

already disclosed or made known in course of original assessment and since there was no incriminating material or facts/circumstances justifying additions made under section 2(22)(e), Tribunal was justified 46 ITA Nos.480/JP/2025 DCIT vs. Karnani Solvex Private Ltd. in deleting addition. After hearing counsel for the parties and considering ... assessment can be made. In the present case, the Revenue does not urge that it discovered any new material justifying the addition under section 2(22)(e). Rather, there was no material to connect the additions made under that head. Clearly, there was no incriminating material or facts and circumstances

DCIT CC-8(2), Mumbai vs. Rakesh S Kathotia, Mumbai

In the result appeal filed by the revenue stands dismissed

ITA 4295/MUM/2025[2017-18]Status: DisposedITAT Mumbai13 Oct 2025AY 2017-18

Bench: Shri Sandeep Gosain & Shri Prabhash Shankar

Section 132Section 153ASection 2(22)(e)Section 250

revenue has raised the following grounds of appeal: 1. The Ld.CIT(A) ought to have appreciated that the addition under section 2(22)(e) is based on material available on record, including financial transactions and shareholding patterns, which are relevant and sufficient for determining total income under section 153A, irrespective ... seized during search. 2 Rakesh Kothotia, Mumbai. 2. The Ld.CIT(A) erred in deleting the addition of Rs.6,29,50,407/- made under section 2(22)(e) of the Act by the Assessing Officer, ignoring the clear findings regarding the pre- arranged, colourable transaction structure involving pass through entities, ultimately

ITO, Ward 6(1), Ludhiana vs. M/S Jujhar Construction & Travels Pvt. Ltd., Ludhiana

In the result, appeal of the Revenue is dismissed

ITA 536/CHANDI/2022[2013-14]Status: DisposedITAT Chandigarh06 Oct 2025AY 2013-14

Bench: Shri Rajpal Yadav & Shri Krinwant Sahayआयकर अपील सं./ Ita No. 536/Chd/2022 "नधा"रण वष" / Assessment Year: 2013-14 The Ito, Vs M/S Jujhar Construction & Ward 6(1), Travels Pvt. Ltd.,Near Pull Jawaddi, Ludhiana. Pakhowal Road, Ludhiana. "थायी लेखा सं./Pan No: Aabcj1127H अपीलाथ"/Appellant ""यथ"/Respondent Assessee By : Shri Sudhir Sehgal, Advocate Revenue By : Shri Manav Bansal, Cit, Dr Date Of Hearing : 02.09.2025 Date Of Pronouncement : 06.10.2025 Physical Hearing O R D E R Per Raj Pal Yadav, Vp

For Appellant: Shri Sudhir Sehgal, AdvocateFor Respondent: Shri Manav Bansal, CIT, DR

Section 143(2)Section 2(22)(e)

2 that ld.CIT (Appeals) has erred in deleting protective addition of Rs.12,24,72,654/- added by the AO with the aid of Section 2(22)(e) of the Income Tax Act, 1961. 3. The brief facts of the case are that assessee has filed its return of income ... very transfer of amount from the group companies for the A.Y.2013-14 4 business purpose which has not resulted into any violation' of section 2(22)(e) of the Income Tax Act, 1961.In the present case one of the group company has transferred the funds to a Company which has further

Kabir Mulchandani, Mumbai vs. ACIT (OSD-II) Cr 7, Mumbai

In the result, appeal of the assessee is allowed

ITA 5342/MUM/2024[2000-2001]Status: DisposedITAT Mumbai06 Oct 2025AY 2000-2001

Bench: Shri Anikesh Banerjee & Smt. Renu Jauhriआयकरअपीलसं./Itano.5342/Mum/2024 (िनधा"रणवष" / Assessment Year: 2000-01) Kabirmulchandani V/S. Acit (Osd-Ii) Cr-7, बनाम C/O R.C Kapoor & Co, Mumbai Chartered Accountants Acit (Osd-Ii) Cr-7, Mumbai D-36, South Extension Part-Ii, New Delhi 110049 "थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aabpm1224B Appellant/अपीलाथ" Respondent/"ितवादी ..

For Appellant: Shri Sanjeev Kapoor, CAFor Respondent: Shri. Hemanshu Joshi, SR DR

Section 142(1)Section 144Section 2(22)(e)Section 250Section 68Section 69C

amount of Rs. 1,20,03,200/- was added to the assessee’s income as deemed dividend after invoking the provisions of section 2(22)(e) of the Act. 6.1. After considering the assessee’s submissions Ld. CIT(A) finally upheld the addition to the extent

Kailash Chand Meena, Alwar vs. ITO Ward2(3), Alwar

In the result, the appeal of the assessee is allowed

ITA 101/JPR/2025[2017-18]Status: DisposedITAT Jaipur30 Sept 2025AY 2017-18

Bench: DR. S. SEETHALAKSHMI (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri Shrawan Kumar Gupta, AdvFor Respondent: Shri Gautam Singh Choudhary, JCIT a

Section 115BSection 143(2)Section 143(3)Section 234ASection 250Section 69A

आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”SMC” JAIPUR Mk0 ,l- lhrky{eh

Mateshwari Bus Operation Private Limited, Ahemdabad vs. Income Tax Officer, TDS Ward 2, Ahemdabad

In the result, appeal of the assessee is allowed

ITA 1073/AHD/2025[2015-16]Status: DisposedITAT Ahmedabad29 Sept 2025AY 2015-16

Bench: Dr. B.R.R. Kumar, Vice-Shri Siddhartha Nautiyalmateshwari Bus Operations Vs. The Income Tax Officer, Private Limited, Tds, Ward-2, U-7, Swastik House, Near Old Ahmedabad. High Court, Navrangpura, Ahmedabad-380009. [Pan :Ahmm13678 A] (Appellant) .. (Respondent) Appellant By : Shri Amit Mundhra, Ar Respondent By: Shri Prateek Sharma, Sr. Dr Date Of Hearing 05.08.2025 Date Of Pronouncement 29.09.2025 O R D E R Per Dr. B.R.R. Kumar, Vice-:- Delay Condoned This Appeal Has Been Filed By The Assessee Against The Order Dated 21.02.2025 Passed By The Ld. Addl/Jcit(A)-7, Mumbai (‘Ld. Cit(A)’ In Short), Under Section 250 Of The Income-Tax Act, 1961 (‘The Act’ In Short), Relating To The Assessment Year 2015-16. 2. The Assessee Has Raised The Following Grounds Of Appeal: “That On The Facts & In The Circumstances Of The Case & In Law, The Learned Assessing Officer Has Grossly Erred In Treating The Bona Fide Inter- Corporate Loan Of Rs.20,00,000/- Advanced By The Assessee To M/S Tak Bus Operations Pvt. Ltd. As "Deemed Dividend" Under Section 2(22)(E) Of The Income-Tax Act, 1961 & In Holding The Assessee To Be An Assessee In Default Under Section 201(1)/201(1A) For Not Deducting Tax At Source Under Section 194 Of The Act. The Learned Assessing Officer Failed To Appreciate That The Transaction Was A Commercial Loan, Fully Disclosed & Subsequently Repaid By The Recipient, The Assessee Was Not The Beneficial Owner Of Shares In The Recipient Company, No Benefit Accrued To Any Shareholder Individually & The Conditions Of Section 2(22)(E) Were Not Satisfied Either In Letter Or In Spirit. The Impugned Order Is Therefore Bad In Law, Based On Presumptions & Liable To Be Quashed In Its Entirety.” Maheshwari Bus Operation Pvt. Ltd. Vs. Ito Asst. Year 2015-16 - 2–

For Appellant: Shri Amit Mundhra, ARFor Respondent: Shri Prateek Sharma, Sr. DR

Section 194Section 2(22)(e)Section 201(1)Section 250

fide inter- corporate loan of Rs.20,00,000/- advanced by the assessee to M/s Tak Bus Operations Pvt. Ltd. as "deemed dividend" under section 2(22)(e) of the Income-tax Act, 1961, and in holding the assessee to be an assessee in default under section 201(1)/201 ... assessee was not the beneficial owner of shares in the recipient company, no benefit accrued to any shareholder individually and the conditions of section 2(22)(e) were not satisfied either in letter or in spirit. The impugned order is therefore bad in law, based on presumptions, and liable

International Creations Private Limited, Surat vs. Income Tax Officer, Ward-1, Surat

In the result, the appeal of the assessee is allowed

ITA 742/SRT/2024[2015-16]Status: DisposedITAT Surat26 Sept 2025AY 2015-16

Bench: SHRI DINESH MOHAN SINHA (Judicial Member), SHRI BIJAYANANDA PRUSETH (Accountant Member)

Section 194Section 2Section 2(22)(e)Section 201Section 201(1)Section 250

aforementioned amount was capital contribution of both the companies and thus out of the purview of deemed dividend as envisaged in provision of section 2(22)(e) of the Act. It is also stated by the Ld. AR that any payment made for commercial purpose is not covered as deemed ... Embroidery Pvt. Ltd. and M/s. International Creations Pvt. Ltd. was not loans and advance and therefore, not covered as deemed dividend as per section 2(22)(e) of the Act. Accordingly, the addition ITA No.742/Srt/2024 A.Y 15-16 International Creations Pvt. Ltd. made in the case of Shri Ashok Kumar

Madison Teamworks Film Promotions and Entertainment Private Limited, Mumbai vs. Deputy Commissioner of Income Tax- 10(2)(2), Mumbai

In the result, the appeal of the assessee is allowed

ITA 3533/MUM/2025[2013-14]Status: DisposedITAT Mumbai26 Sept 2025AY 2013-14

Bench: Shri Vikram Singh Yadav & Shri Rahul Chaudharyassessment Year : 2013-14 Madison Teamworks Film Deputy Commissioner Of Promotions & Entertainment Income Tax-10(2)(2), Private Limited, Vs. Aayakar Bhavan, 1St Floor, 349 Business Point, M.K. Road, Western Express Highway, Mumbai-400020. Andheri (East), Mumbai-400069. Pan : Aaecm1006B (Appellant) (Respondent) For Assessee : Mr. Siddesh Chaugule & Ms. Manmeet Kaur Saini For Revenue : Shri Annavaram Kosuri, Sr.Dr

For Appellant: Mr. Siddesh Chaugule &For Respondent: Shri Annavaram Kosuri, Sr.DR

Section 143(3)Section 2(22)(e)Section 271(1)(c)Section 274Section 40A(3)

assessment proceedings that the assessee-company‟s transactions with its related concerns are covered by the provisions of section 2(22)(e) of the Act. Further, the Ld. CIT(A) has confirmed the disallowance made u/s. 40A(3) of the Act and partly confirmed the addition made on account ... assessment proceedings that the assessee-company‟s transactions with its related concerns are covered by the provisions of section 2(22)(e) of the Act is factually incorrect. At the same time, it was submitted that as far as quantum proceedings are concerned, the same has attained finality

Arihant Fertiliser and Chemicals India Limited, Indore vs. The Deputy Commissioner of Income Tax 1(1), Indore

ITA 711/IND/2024[2015-16]Status: DisposedITAT Indore22 Sept 2025AY 2015-16

Bench: Shri B.M. Biyani

Section 143(2)Section 143(3)Section 147Section 148Section 2(22)(e)

without considering the fact that the assessee was not a shareholder of M/s Arihant Bio-Chem Ltd. and therefore the provisions of section 2(22)(e) did not have any application. 6. Apropos to this ground, the relevant facts are very limited and do not require any elaboration. During ... Chemicals India Ltd. ITA No.711And/2024 Assessment year 2015-16 7. Ld. AR for assessee made a straight forward contention that the provision of section 2(22)(e) had already been analysed in a series of decision by various appellate forums and it is now clear that the taxability would