https://www.taxtmi.com/caselaws?id=280605 The court held that proposed dividends on preference and ordinary shares are not deductible in computing the net wealth of the assessee company under the Wealth Tax Act. It emphasized that a mere recommendation by directors does not create a liability, and dividends only become payable upon approval by the general body. The court ruled against considering provision for dividends as a liability in the balance sheet, stating that the Wealth Tax Officer has the authority to verify actual liabilities. The court concluded that proposed dividends do not constitute debts owed by the company on the valuation date, denying the deductions and ordering the assessees to pay department costs. en-us Mon, 09 Apr 1962 00:00:00 +0530 Mon, 13 May 2019 13:15:59 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=280605 The court held that proposed dividends on preference and ordinary shares are not deductible in computing the net wealth of the assessee company under the Wealth Tax Act. It emphasized that a mere recommendation by directors does not create a liability, and dividends only become payable upon approval by the general body. The court ruled against considering provision for dividends as a liability in the balance sheet, stating that the Wealth Tax Officer has the authority to verify actual liabilities. The court concluded that proposed dividends do not constitute debts owed by the company on the valuation date, denying the deductions and ordering the assessees to pay department costs. Case-Laws Income Tax Mon, 09 Apr 1962 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=280605