During the year under consideration, the assessee-partnership firm received capital contributions from two partner-companies in which two other partners held substantial interest. The assessee was neither a registered shareholder nor a beneficial owner of shares held in the companies. However, the assessing officer assessed the contributions as deemed dividend under section 2(22)(e) and taxed the same in the hands of assessee. The Commissioner of Income-Tax (Appeals) held that the capital contribution could not be treated as loans or advances extended to the assessee and therefore, the assessing officer could not have treated the same as deemed dividend in the hands of the assessee and the same has been upheld by the Hon’ble Tribunal. On appeal by the Department, the Hon’ble Delhi High Court  held that capital contribution made by the two partner-companies could not be treated as a loan or advance extended to assessee and therefore, addition could not be made in hands of assessee. Further, if at all addition could have been made, it could’ve been in hands of two individual partners and that too only by their assessing officers after affording them an opportunity of being heard.(AY. 2006-07), 2010-11)