https://www.taxtmi.com/caselaws?id=169597 Explanation 3 to Section 4(1)(c) was treated as valid because it rested on a real territorial nexus: dividends paid outside British India could be deemed to accrue in British India to the extent they were paid out of profits already taxed there. The provision was therefore within legislative competence. On the assessment question, dividend income of a non-resident could be brought to tax in the hands of the Indian company as statutory agent under Section 42, since the income was held to arise from profits earned in British India and thus from an Indian source. The legal principle applied was that deemed accrual is sustainable where the income has a sufficient territorial connection with the taxing territory. en-us Tue, 18 Sep 1951 00:00:00 +0530 Mon, 27 Apr 2015 15:07:24 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=169597 Explanation 3 to Section 4(1)(c) was treated as valid because it rested on a real territorial nexus: dividends paid outside British India could be deemed to accrue in British India to the extent they were paid out of profits already taxed there. The provision was therefore within legislative competence. On the assessment question, dividend income of a non-resident could be brought to tax in the hands of the Indian company as statutory agent under Section 42, since the income was held to arise from profits earned in British India and thus from an Indian source. The legal principle applied was that deemed accrual is sustainable where the income has a sufficient territorial connection with the taxing territory. Case-Laws Income Tax Tue, 18 Sep 1951 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=169597