Grossing up of dividend determines distributed profits tax base through a prescribed adjustment, with a specific dividend exclusion. Grossing up of dividend requires the dividend amount, after reduction of tax under the relevant sub-section, to be increased to the amount that would, after deduction of tax at the prescribed rate, equal the net distributed profits. The provision operates as a grossing-up mechanism for determining the tax base on distributed profits. The grossing-up rule does not apply to dividend referred to in clause (e) of section 2(22).