Dividend distribution tax

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

29 August 2011 As per Sec 115 O For the purpose of levying dividend distribution tax following amounts shall be reduced from the Dividend so distributed :

W.e.f. 1.4.2008 where the domestic company has received any dividend from its subsidiary company (where its share holding is more than 50% of its nominal capital), and if such subsidiary has paid dividend distribution tax on dividend declared by it, then the amount of such dividend shall be reduced from the amount of dividend liable to tax, provided the domestic company itself is not a subsidiary of any other company, further provided that the same amount of dividend shall not be taken into account for deduction more than once.

In our case the subsidiary Company has declared dividend in the BS 2010-11 which will be paid after AGM.
Holding Company accounted for dividend income from subsidiary on accrual basis.Holding Company also declared Dividend.Whether Holding Company will get set off of DDT to the extent amount of dividend income accrued.

VISHRUT

VISHRUT (Expert)
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29 August 2011 Yes Holding Company will get set off.

Querist : Anonymous

Querist : Anonymous (Querist)

30 August 2011 Whether set off is allowed even if dividend income is not received and it is only accrued.As per section it is received

where the domestic company has received any dividend from its subsidiary company

Please clarify and also reproduce any case law or any other interpretation