Deemed dividend 2(22)

As per section 46(2),if a shareholder has received cash or other assets at the time of liquidaton then he shall be chargeable to income tax under the head capital gains and sales consideration for that purpose shall be calculated as :

MONEYS RECEIVED    XXXX

ADD:MARKET VALUE OF ASSETS RECEIVED XXXX

LESS:AMOUNT ASSESSED AS DIVIDEND UNDER SECTION 2(22)(C)  XXX

As you can clearly see,dividend under sec 2(22((c) has not been included in sales consideration for the purpose of capital gains.It is excluded as company has already paid CDT on this amount.

Moreover to bring more clarity to you,As per sec 46(1), transfer made by company at the time of liquidation of assets to shareholders shall not be deemed as transfer for the purpose of capital gains.

I hope this solve your query,feel free to ask anything else

It doesnt come under other sources head since this income has arisen as a result of capital asset i.e. shareholding in a company.As a result when at the time of liquidation you surrender your rights you are liable to pay capital gain on capital asset parted away.