https://www.taxtmi.com/caselaws?id=38597 Whether dividend distribution was unreasonable under section 23A depended on a mixed question of law and fact, not a pure factual inquiry, because the statutory test had to be applied to the company's financial position. The proper approach was to assess reasonableness from the standpoint of a prudent businessman, having regard to prior losses, commercial profits available for distribution, and the business needs of the company. On the facts stated, the dividend already declared was a substantial part of the commercial profits and the company could not in any event have distributed the statutory percentage from those profits. The declaration of dividend was therefore not unreasonable and section 23A did not apply. en-us Thu, 08 Nov 1973 00:00:00 +0530 Wed, 07 Apr 2010 14:57:52 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=38597 Whether dividend distribution was unreasonable under section 23A depended on a mixed question of law and fact, not a pure factual inquiry, because the statutory test had to be applied to the company's financial position. The proper approach was to assess reasonableness from the standpoint of a prudent businessman, having regard to prior losses, commercial profits available for distribution, and the business needs of the company. On the facts stated, the dividend already declared was a substantial part of the commercial profits and the company could not in any event have distributed the statutory percentage from those profits. The declaration of dividend was therefore not unreasonable and section 23A did not apply. Case-Laws Income Tax Thu, 08 Nov 1973 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=38597