Dividends.
21194. 22The principal officer of an Indian company or a company which has made the prescribed arrangements for the declaration and payment of dividends (including dividends on preference shares) within India, shall, before making any payment in cash or before issuing any cheque or warrant in respect of any dividend or before making any distribution or payment to a shareholder, 23[who is resident in India,] of any dividend within the meaning of sub-clause (a) or sub-clause (b) or sub-clause (c) or sub-clause (d) or sub-clause (e) of clause (22) of section 2, deduct from the amount of such dividend, income-tax 24[***] at the rates in force :
25[Provided
that no such deduction shall be made in the case of a shareholder, being an
individual, if—
(a) the dividend is paid by the company by an
account payee cheque; and
(b) the amount of such dividend or, as the case
may be, the aggregate of the amounts of such dividend distributed or paid or
likely to be distributed or paid during the financial year by the company to
the shareholder, does not exceed 26[two
thousand five hundred] rupees:
Provided further that the provisions of this section
shall not apply to such income credited or paid to—
(a)
the Life Insurance Corporation of
(b)
the General Insurance Corporation of
India (hereafter in this proviso referred to as the Corporation) or to any of
the four companies (hereafter in this proviso referred to as such company),
formed by virtue of the schemes framed under sub-section (1) of section 16 of
the General Insurance Business (Nationalisation) Act, 1972 (57 of 1972), in
respect of any shares owned by the Corporation or such company or in which the
Corporation or such company has full beneficial interest;
(c) any other insurer in respect of any shares owned by it or in which it has full beneficial interest :]
27[Provided also that no such deduction shall be made in respect of any dividends referred to in section 115-O.]