TaxTMI Login
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →Just a moment...
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
Issues: Whether, for computation of chargeable profits under rule 1(viii) of the First Schedule to the Companies (Profits) Surtax Act, 1964, the dividend to be excluded is the gross dividend or only the net dividend after deductions allowed under the Income-tax Act, 1961.
Analysis: The expression "income by way of dividends" in rule 1(viii) was construed with reference to the amount actually included in the assessee's total income under the Income-tax Act. The Court held that the relevant exclusion under the Surtax Act is confined to the dividend income as computed and included in total income after giving effect to deductions permissible under the Income-tax Act, because the chargeable profits computation cannot give a double benefit by excluding an amount larger than what formed part of total income. The Explanation inserted with effect from 1 April 1981 was treated as clarificatory of the substantive rule rather than as creating a new principle.
Conclusion: Only the net dividend, and not the gross dividend, is deductible in computing chargeable profits under rule 1(viii); the question was answered against the assessee and in favour of the Revenue.
Ratio Decidendi: For computing chargeable profits under rule 1(viii) of the First Schedule to the Companies (Profits) Surtax Act, 1964, the deductible dividend is only the amount actually included in total income under the Income-tax Act after permissible deductions.
TaxTMI 
TaxTMI 
