Dividend income was treated at processing as falling under...

Dividend income was treated at processing as falling under s.10(34) and taxed beyond ₹10 lakh by applying s.115BBDA on the premise that it arose from domestic companies. On evidence showing the dividend was from mutual funds and was necessarily reported in Schedule EI without bifurcation, the Tribunal held that such income squarely falls under s.10(35) and is fully exempt, rendering s.115BBDA inapplicable; the corresponding addition was deleted. On the claimed capital loss, since the first appellate authority had directed verification and allowance if found correct and the supporting documents were on record, no interference was warranted and the ground was allowed for statistical purposes. - ITAT