| Question And Answer | |
|---|---|
| Subject: | LLP |
| Category: | Income-Tax |
| Querist: | bs |
| Answered by: | Advocate Shashi Ashok Bekal |
| Tags: | LLP, loan, Pvt company |
| Date: | June 14, 2023 |
Can a Pvt ltd Company give loan to LLP in which partners are relative of director and share holders of the company ?
With reference to section 185(2) of companies act and 2 (22)(e) of income tax act – deemed dividend
This is a case where the loan is given to a person who isn’t a registered shareholder. The Hon’ble Supreme Court in the case of National Travel Services v. CIT [2018] 300 CTR 582 (SC) where the issue was whether to attract section 2(22)(e) of the Act, a ‘shareholder’ has only to be a person who is a beneficial owner of the shares and he need not necessarily be a registered shareholder. The matter is referred to the Chief Justice of India and is still pending.
Disclaimer: This article is only for general information and is not intended to provide legal advice. Readers desiring legal advice should consult with an experienced professional to understand the current law and how it may apply to the facts of their case. Neither the author nor itatonline.org and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any inaccurate or incomplete information in this article nor for any actions taken in reliance thereon. No part of this document should be distributed or copied (except for personal, non-commercial use) without express written permission of itatonline.org