“(1B) For the purposes of determining the tax on distributed profits payable in accordance with this section, any amount by way of dividends referred to in sub-section (1) as reduced by the amount referred to in sub-section (1A) [hereafter referred to as net distributed profits], shall be increased to such amount as would, after reduction of the tax on such increased amount at the rate specified in sub-section (1), be equal to the net distributed profits.”.
I define as bellow
100 - any amount by way of dividends referred to in sub-section (1) (Dividend Declared)
-(Nil) -as reduced by the amount referred to in sub-sec (1A) (div received from subsidiary Comp)
100 -[hereafter referred to as net distributed profits],
119.995 -shall be increased to such amount as would,
-19.995 -after reduction of the tax on such increased amount at the rate specified in sub-sec (1),
100 -be equal to the net distributed profits.(Defined above)
Hence the Dividend rate is @ 16.995 Effective rate is 19.995.
