Court : Supreme Court of India
Reported in : AIR1964SC1866; 34CompCas668(SC); 53ITR83(SC); (1965)67PLR248; 7SCR579
..... and referred the question set out hereinbelow to the high court of punjab under s. 66(1) of the indian income-tax act :'whether on a true interpretation of article 95 of the first schedule to the indian companies act, 1913, the dividend of rs. 4,12,500/- was liable to be included in the assessment year 1952-53.'3. the high court recorded ..... the former rampur state, and it had adopted special articles of association in supersession of table a of the companies act. the relevant articles of govan bros. dealing with declaration or payment of final and interim dividends were articles 73 and 74. the high court therefore proceeded to deal with the question on the footing that it was, by the question referred, called ..... to rescind the resolution for payment of dividend even if it is one in form declaring dividend.6. the indian companies act, 1913 contains no provision for declaration of dividend either interim or final : it does not say as to who shall declare the dividend, nor does it say that dividend may be declared in a general meeting of the company. but s. 17(2) provides that the ..... company may adopt all or any of the regulations .....Tag this Judgment!
Court : Supreme Court of India
Reported in : AIR1967SC795; 63ITR300(SC); 1SCR777
..... of the year or of accumulated profits was therefore 'dividend' within the meaning of the companies act, 1913, and also of the income-tax act, 1922. by act 7 of 1939 an inclusive definition of 'dividend' was devised, so as to include therein heads of distribution by a company which may not normally be regarded as dividend : and one such head was in clause(c). ..... a going concern distributing profits of the year or accumulated profits is regarded as distributing dividend among the shareholders, but if the company is would up before distributing its accumulated profits, any distribution of profits by the liquidator is not regarded under the companies act as dividend. in commissioners of inland revenue v. george burrell, pollock m.r., observed : '.... it is a ..... therefore distributed as capital of the company, since the liquidator has no power to distribute dividend, and the sums received by the shareholders cannot be disintegrated into capital and profits, by examining the accounts of the company when it was a going concern. 7. the scheme of the indian companies act closely followed the english companies act and the view expressed in george ..... burrell's case i.l.r.  k.b. 52 applied to distributions made by liquidators, and those distributions were not liable to be taxed as dividend. the parliament with a view to avoid escapement of tax devised .....Tag this Judgment!
Court : Andhra Pradesh
Reported in : 1994(2)ALT87; (1994)119CTR(AP)184; 207ITR508(AP)
..... to the view expressed by the special bench of the tribunal. the special bench followed the computation of income under the companies act. according to the tribunal, the company can declare dividends only after setting off depreciation. it can also declare dividends even if there was past losses still remaining to be set off. the basis for this distinction is that loss ..... borrowing enactment. therefore, the interpretation of 'loss' and 'depreciation' for the purpose of declaring dividend under the companies act, 1956, is irrelevant and their interpretation under clause (iv) of explanation to section 115j of the act should be in accordance with the provisions of the income-tax act. further, the special bench had failed to take note of the fact that the unabsorbed ..... also expressed the view that the computation of profit and loss under the companies act for the purpose of declaring dividend cannot be adopted for the purpose of computing the taxable income under section 115j of the income-tax act. the purpose of computation of profit and loss under the companies act, 1956, is different from the purpose of computing the income under ..... , sri s. r. ashok, that computation to be made for the purpose of declaring dividend under the companies act cannot be adopted for the purpose of computing taxable income under the provisions of the income-tax act and that for the purpose of section 115j of the act, 'loss' does not include 'unabsorbed depreciation'. 70. the reference made by the tribunal .....Tag this Judgment!
Court : Kolkata
..... damage or otherwise, cannot be allowed as a business expense. moreover, even though the preference shareholders have preference in the matter of receipt of dividend under the companies act, 1956, they are treated as the owners of the company and any payment made to the owners has to be shown in the appropriation column and cannot be treated as an expense for earning the ..... of the liquidated damages and therefore, should have been allowed as a deductible expense. c) mr.murarka relied on a passage from ramaiya on the companies act, 16th edition, vol.1, page-1105, - the company becomes liable to pay dividend on preference shares only when it declares dividend, and if in the meanwhile the preference shares are redeemed, the right of the preference shareholders to ..... due to whatsoever reason the company has not been able to declare the dividend, the company agrees to compensate the investor, such that the post-tax ( ..... and balance in reserves, the amount of dividend which could not be paid for that year shall accumulate and shall be paid in the immediate next year in which it is possible to declare and pay dividends according to the provisions of the companies act, 1956. further, in case of any delay in declaration of dividend or where due to inadequacy of profits or .....Tag this Judgment!
Court : Mumbai
Reported in : AIR1956Bom381; (1956)58BOMLR689; 26CompCas357(Bom); ILR1956Bom640
..... reason of the fact that he is a shareholder of part of the profits of the company distributed pro rata among all the shareholders, can be considered to be dividend for the purpose of the taxing law although the formalities required by the companies act for the distribution of dividend have not been complied with.mr. palkhivala is perfectly right when he says that from ..... is neither a formal recommendation by the directors that a dividend should be paid, nor is there any acceptance, formal or otherwise, by the company of that recommendation. but would it be true to say that because the company has not complied with the procedure required for the declaration of dividend under the companies act. it is competent to a shareholder who has received ft ..... part of the profit from the company distributed among all the shareholders to tell the taxing authorities that he is not liable to pay tax ..... on that income as dividend because his company has failed to carry out the formalities and .....Tag this Judgment!
Court : Income Tax Appellate Tribunal ITAT Madras
Reported in : (1993)45ITD124(Mad.)
..... assessees the dividend income of more than one year would not have arisen.in this regard, shri vaidyanathan highlighted the fact that ..... the orders of the madras high court, the board of directors would certainly have recommended, in time, dividends for the years 1977, 1978 and 1979; annual general meetings would have been held within the time allowed under section 166 of the companies act; and the dividends declared in those meetings. in that event, the question of bringing to charge in the hands of the ..... the mandate of section 166 of the companies act was that an annual general meeting be held each year within the stipulated time. this mandate could ..... as invalid.59. this brings us on to the issue relating to the aggregation of dividends. it is a matter of record that the 30th, 31st and 32nd annual general meetings could not be held within the time allowed by and under section 166 of the companies act, 1956, by reason of the board of directors having been superseded by the orders of .....Tag this Judgment!
Court : Mumbai
Reported in : 67ITR640(Bom)
..... , has pressed upon us that in interpreting the said provision, we should give the language 'dividend declared in respect of any previous year' the meaning which it should have, having regard to the concept of dividend under the companies act and the meaning that the said expression has in company law matters. he has invited our attention to a passage from the handbook on the ..... and 896, where it has been observed as follows : 'the declaration of a dividend creates a debt due from the company to each shareholder and payable at the date at which the dividend is made payable....... 'arrears of dividend' and 'back dividends' are inaccurate expressions'. 10. mr. joshi has then referred ..... formation, management and winding up of joint stock companies by sir francis g. brown, at page 522, where the learned author has ..... make up the arrears, this dividend is not a dividend in respect of the year, or years, during which no payment was made. its amount may be measured by the arrears, but it is a divided for the year, or other financial period, in which it was declared'.9. he has referred us to buckley on the companies act (13th edn.) at pages 895 .....Tag this Judgment!
Court : Mumbai
Reported in : 109ITR172(Bom)
..... be done or not will depend upon the provisions in the company law as regards the liability in respect of the dividend. it is clear from the provisions of company law that no company has a right to declare dividend out of its capital as understood under the companies act. under section 205 of the companies act, 1956, dividend can only be declared out of the profits of the ..... to the last date of the previous year for which the accounts are to be approved. but, so far as dividend is concerned, it is clear, having regard to the provisions of the companies act, 1956, that the liability to pay dividend will not revert back to the last date of the previous year for which the accounts are approved by the shareholders ..... company for that year arrived at after providing for depreciation in accordance with ..... the provisions of that statute or out of the profits of the company for .....Tag this Judgment!
Court : Punjab and Haryana
Reported in : 44ITR127(P& H)
..... question propounded by the tribunal for our consideration reads :'whether on a true interpretation of article 95 of the first schedule to the indian companies act, 1913, the dividend of rs. 4,12,500 was liable to be included in the assessment year 1952-53 ?'the relevant facts are that the accounting period for the assessment year in ..... the appellate tribunal. the decision was based on a distinction drawn between dividend declared and paid under article 95 of table 'a' in the first schedule to the indian companies act, 1913, and dividend paid under article 96. these articles read :'95. the company in general meeting may declare dividends. but no dividends shall exceed the amount recommended by the directors.96. the directors may ..... from time to time pay to the members such interim dividends appear to the directors to be justified by the profits ..... govan brothers (rampur) ltd. which apparently was registered under the rampur state companies act, 1932, the wording of the relevant articles differs slightly from the words used in articles 95 and 96 of table 'a'. the two relevant articles read :'73. the company in general meeting may declare a dividend to be paid to the members according to their rights and interests in .....Tag this Judgment!
Court : Supreme Court of India
Reported in : 230ITR477(SC); JT1998(1)SC347; 1998(1)SCALE273; (1998)3SCC106; 1SCR288
..... been contented by the learned counsel for the appellant that the high court erred in coming to the conclusion that there was any declaration of any dividend, as understood under the companies act, by the company. according to the learned counsel, the resolution of the board of directors dated 6th december, 1962 cannot be regarded as a declaration of ..... 1962 amounted to a declaration of dividend. under sec. 205 of the companies act, dividend is distributed on a resolution being passed by the company in general meeting. the companies act, as such, does not specifically refer to the distribution of interim dividend. table a. however, provides for payment of interim dividends. two clauses of table a to the companies act, namely, clause 85 and 86 read ..... as follows:-'85. the company in general meeting may declare dividends, but no dividend ..... sub-clause (c) of clause (i) of the second proviso to the same act read with explanation 3 to the same act.'5. the high court came to the conclusion that the company, acting through its directors, had declared the interim dividend on behalf of the company and when the payment was made not in the same previous year but was .....Tag this Judgment!