https://www.taxtmi.com/caselaws?id=49298 Section 2(6A)(d) of the Indian Income-tax Act, 1922 treats accumulated profits distributed on a reduction of capital as dividend, preventing profit distributions from escaping tax through a capital-reduction mechanism. The provision falls within the income-tax legislative field despite company law permitting capital reduction. Distribution occurs when the company actually or constructively makes the surplus available to shareholders through credit or payment, rather than when the court-sanctioned capital reduction formally takes effect. Accordingly, taxability and any related super-tax rebate adjustment arise in the accounting year of credit or payment. en-us Tue, 09 Feb 1965 00:00:00 +0530 Wed, 20 Aug 2014 19:18:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=49298 Section 2(6A)(d) of the Indian Income-tax Act, 1922 treats accumulated profits distributed on a reduction of capital as dividend, preventing profit distributions from escaping tax through a capital-reduction mechanism. The provision falls within the income-tax legislative field despite company law permitting capital reduction. Distribution occurs when the company actually or constructively makes the surplus available to shareholders through credit or payment, rather than when the court-sanctioned capital reduction formally takes effect. Accordingly, taxability and any related super-tax rebate adjustment arise in the accounting year of credit or payment. Case-Laws Income Tax Tue, 09 Feb 1965 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=49298