Farida Holdings (P.) Ltd. v Deputy Commissioner of Income-tax [2012] 21 taxmann.com 462 (Chennai – Trib.) The assessee is a private limited company, mainly functioning in the role of a holding company over a number of hundred-percent subsidiary companies. The assessee company is exercising administrative control over the subsidiaries in its status as holding company. In that status the assessee company is also managing the financial affairs of its subsidiaries. The assessee company is monitoring the inflows and outflows of the subsidiary companies in its attempt to utilize the available funds to the maximum advantage of the group companies. The Assessing Officer found that the assessee company had received loan amounts from different subsidiaries and those borrowed funds were in turn advanced to other subsidiaries. According to the assessing authority, the loans obtained by the assessee from its subsidiaries were in the nature of deemed dividends as per section 2(22)(e) of the Income-tax Act, 1961 and, therefore, liable to be taxed.