CMA Intermediate · Direct and Indirect Taxation · Income from Other Sources
A resident individual receives Rs. 70,000 dividend from a company in the tax year. Which is correct under section 92 of the Income-tax Act, 2025?
The whole Rs. 70,000 is chargeable under Income from other sources because section 92(2)(a) taxes any dividend, with no minimum threshold. The Rs. 50,000 limit applies only to receipts without consideration under clause (m), not to dividends.
- AOnly the amount exceeding Rs. 50,000 is taxable as a dividend
- BThe dividend is not taxable because it is received from a company
- CThe dividend is taxable under capital gains
- DThe whole Rs. 70,000 is chargeable under 'Income from other sources'Correct
Explanation
Section 92(2)(a) charges any dividend under Income from other sources. No Rs. 50,000 threshold applies to dividends, since that figure relates to gifts under clause (m). So the entire Rs. 70,000 is chargeable.
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