https://www.taxtmi.com/article/detailed?id=7287 Security premium is a capital receipt and not part of accumulated profit or surplus; it cannot be included in accumulated profits for computing deemed dividend under the deeming provision taxing advances to substantial shareholders. Administrative inclusion of share premium by Assessing Officers is legally unsound, has been overturned on appeal in reported instances, and often leads to unnecessary litigation prompted by audit objections or counsel recommendations. The author urges restraint by officers, cautious permission to appeal by commissioners, and a clarifying board circular excluding share premium from such accumulated profit computations. en-us Mon, 20 Feb 2017 21:50:50 +0530 Mon, 20 Feb 2017 21:50:50 +0530 TaxTMI RSS Generator https://www.taxtmi.com/article/detailed?id=7287 Security premium is a capital receipt and not part of accumulated profit or surplus; it cannot be included in accumulated profits for computing deemed dividend under the deeming provision taxing advances to substantial shareholders. Administrative inclusion of share premium by Assessing Officers is legally unsound, has been overturned on appeal in reported instances, and often leads to unnecessary litigation prompted by audit objections or counsel recommendations. The author urges restraint by officers, cautious permission to appeal by commissioners, and a clarifying board circular excluding share premium from such accumulated profit computations. Articles Income Tax Mon, 20 Feb 2017 21:50:50 +0530 https://www.taxtmi.com/article/detailed?id=7287