<h1>Section 2 Amendment Expands 'Accumulated Profits' Definition for Dividends, Includes Amalgamated Companies' Profits from April 2018 Onwards.</h1> The scope of 'accumulated profits' for dividend purposes is being expanded under Section 2 of the Act. Clause (22) defines dividends to include distributions from accumulated profits to shareholders through various means. Companies have been using amalgamation to avoid tax liabilities on distributed profits. To prevent such practices, a new Explanation 2A will be added, ensuring that the accumulated profits of an amalgamated company include those of the amalgamating company. This amendment, effective from April 1, 2018, applies to the assessment year 2018-19 and subsequent years.