https://www.taxtmi.com/caselaws?id=39809 In proceedings under section 23A of the Indian Income-tax Act, 1922, the reasonableness of non-distribution of dividend is to be judged from the standpoint of a prudent businessman, with commercial profits, reserves, financial position and surrounding circumstances as the relevant factors. Assessed income is not the decisive test, and subsequent losses do not affect the enquiry. On the facts stated, the company had sufficient commercial profits and surplus, no dividend was declared, and no business necessity justified retention; the statutory condition for applying section 23A was therefore satisfied. en-us Thu, 19 Jul 1973 00:00:00 +0530 Tue, 20 Apr 2010 13:38:26 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=39809 In proceedings under section 23A of the Indian Income-tax Act, 1922, the reasonableness of non-distribution of dividend is to be judged from the standpoint of a prudent businessman, with commercial profits, reserves, financial position and surrounding circumstances as the relevant factors. Assessed income is not the decisive test, and subsequent losses do not affect the enquiry. On the facts stated, the company had sufficient commercial profits and surplus, no dividend was declared, and no business necessity justified retention; the statutory condition for applying section 23A was therefore satisfied. Case-Laws Income Tax Thu, 19 Jul 1973 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=39809