BENGAL & ASSAM INVESTORS LTD vs COMMISSIONER OF INCOME TAX, WEST BENGAL

The Supreme Court upheld the High Court's decision that the dividend income of an investment company is taxable under Section 12 of the Indian Income-tax Act, 1922, rather than Section 10. The Court established that merely being incorporated as an investment company does not equate to carrying on a business in shares; the company must actively deal in shares to qualify for business income treatment. The appeal was dismissed, affirming that the company was not conducting business in respect of shares, akin to an individual merely holding shares for dividends.