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 the assessee-company's business, for the purposes of section 23A of the Indian Income-tax Act, 1922, consisted wholly or mainly in the dealing in or holding of investments.
Analysis: The expression "wholly or mainly" was held to refer to the primary business of the company. A company engaging in more than one substantial activity cannot be treated as falling within the provision unless dealing in or holding investments is its dominant activity. The shares of the managed companies were acquired not as part of an investment business but to safeguard and support the managing agency business, so the dividend income from those shares was linked to that business and not to a separate investment activity. The court also considered the company's objects, profits from the relevant activities, and the assets employed, and found that none of these showed that its business was predominantly in dealing in or holding investments.
Conclusion: The assessee-company did not fall within section 23A as a company whose business consisted wholly or mainly in the dealing in or holding of investments, and the answer was against the Revenue and in favour of the assessee.
Ratio Decidendi: For section 23A, the relevant test is whether dealing in or holding investments is the company's primary business, and investments made only to protect or support another business do not convert the company into one whose business consists wholly or mainly in investments.
TaxTMI 
TaxTMI 
