Reduction of share capital - (New) Section 2(40)(d) / (Old) Section 2(22)(d)

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....mulated profits, whether capitalised or not; Essential Conditions for Applicability • (a) There must be a company • The distribution must be made by a company. • (b) There must be a reduction of capital • The distribution must occur as part of a capital reduction. • Reduction of capital may take place under company law through: ....

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.... Meaning of Accumulated Profit • "Accumulated profits" shall include all profits of the company up to the date of distribution or payment. Under Section 2(22)(d) of the Income Tax Act, 1961 [ Upto 31.03.2026 ] Dividend includes any distribution to its shareholders by a company on reduction of its capital to the extent to which the company possesses accumulated profits,....