Mr. Sharad Kumar v. The DCIT

Parties Involved

Facts Summary

The assessee, Mr. Sharad Kumar, is an individual and Director of M/s. Kalaignar TV Pvt. Ltd. (KTVPL). He filed his return of income for the Assessment Year 2010-11 declaring income of Rs.55,79,570/-. The case was selected for scrutiny. The Assessing Officer (AO) noted that Mr. Kumar had obtained a loan of Rs.50 Crs. from the Indian Overseas Bank (IOB) and advanced the same as a loan to KTVPL. According to the AO, KTVPL repaid the loan along with interest to Mr. Kumar, who in turn repaid the loan along with interest to IOB. The AO further noted that KTVPL had deducted tax at source on the interest paid to Mr. Kumar. The AO added Rs.94,64,375/- as deemed perquisite u/s.2(24)(iv) of the Income Tax Act, 1961. Mr. Kumar appealed against this addition, arguing that he did not have any substantial interest in KTVPL and did not receive any benefit or perquisite from the company.…

Legal Issues

• 1. Whether the addition of Rs.94,64,375/- as deemed perquisite u/s.2(24)(iv) of the Income Tax Act, 1961 is justified?

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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