Dividend traced to accumulated capital gains was held not taxable in the assessee's hands under binding precedent.

Dividend traced to a company's accumulated capital gains was not taxable in the assessee's hands, as the question referred under section 66(1) of the Indian Income-tax Act, 1922 was treated as covered by the binding decision in Commissioner of Income-tax v. Nalin Behari Lall Singha. On that footing, the inclusion of Rs. 2,344 as dividend in the assessee's total income for assessment year 1949-50 was held unjustified, and the answer went against the Revenue.

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Issues: Whether Rs. 2,344 received as dividend and traced to the company's accumulated capital gains was rightly included in the assessee's total income for the assessment year 1949-50.

Analysis: The question referred under section 66(1) of the Indian Income-tax Act, 1922 was treated as concluded by the binding decision in Commissioner of Income-tax v. Nalin Behari Lall Singha. On that footing, the amount in dispute was held not to be taxable as dividend in the assessee's hands.

Conclusion: The inclusion of Rs. 2,344 as dividend in the assessee's total income was not justified and the answer was against the Revenue.

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