As Per Income Tax Act 1961 “Basis of charge of dividend income” includes:
For the purposes of inclusion in the total income of an assessee:
i) Any dividend declared by a company or distributed or paid
ii) Any interim dividend shall be deemed to be the income of the previous year
Related Case:
Income Tax Act, 1961—Income Tax Rules, 1962, rule 8—The primary question in this appeal was—”Whether, on the facts and circumstances of the case, the learned Income-tax Appellate Tribunal was justified in confirming the dis-allowance of cess paid on green tea leaves . While allowing the appeal, the Gawahati High Court held that (i) it would appear from the pleadings on record that both the judgments of this court were brought to the notice of the learned Tribunal and despite that the learned Tribunal, which is otherwise bound to follow the judgment of the jurisdictional High Court, has failed to take care of it and act there-upon in answering the questions pleaded before the learned Tribunal. Judicial propriety requires that the decision of the jurisdictional High Court has to be obeyed by all Tribunals unless the contrary is available from any judgment of the apex court. (ii) Consequently, we allow this appeal, set aside the impugned order dated August 23, 2006, passed by the learned Tribunal so far it relates to the question raised in this appeal, and answer the question in favor of the assessee and against the Revenue reiterating that the cess on green tea leaves shall be allowed on 100 per cent. Composite income under the Income-tax Act, 1961, before applying rule 8 of the Income-tax Rules. Jorehaut Group Ltd. vs. Assistant Commissioner of Income-tax (HC)
Reference:
As Per Section 8, of the Income Tax Act, 1961-
For the purposes of inclusion in the total income of an assessee,—
(a) any dividend declared by a company or distributed or paid by it within the meaning of sub-clause (a) or sub-clause (b) or sub-clause (c) or sub-clause (d) or sub-clause (e) of clause (22) of section 2 shall be deemed to be the income of the previous year in which it is so declared, distributed or paid, as the case may be;
(b) any interim dividend shall be deemed to be the income of the previous year in which the amount of such dividend is unconditionally made available by the company to the member who is entitled to it.