https://www.taxtmi.com/caselaws?id=276407 Prior-year losses remained relevant in assessing the applicability of section 23A(1) of the Income-tax Act, even after they had been adjusted against paid-up capital through reconstruction. The court held that such losses continued to affect the company's financial position and its capacity to distribute dividends, so the proper test was whether any failure to declare a larger dividend was unreasonable in light of those losses and the weakened capital structure. Accordingly, the earlier losses had to be considered when judging the reasonableness of the dividend declared. en-us Sat, 04 May 1963 00:00:00 +0530 Sat, 10 Nov 2018 11:11:56 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=276407 Prior-year losses remained relevant in assessing the applicability of section 23A(1) of the Income-tax Act, even after they had been adjusted against paid-up capital through reconstruction. The court held that such losses continued to affect the company's financial position and its capacity to distribute dividends, so the proper test was whether any failure to declare a larger dividend was unreasonable in light of those losses and the weakened capital structure. Accordingly, the earlier losses had to be considered when judging the reasonableness of the dividend declared. Case-Laws Income Tax Sat, 04 May 1963 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=276407