Dividend and interest incomes are classified under the head income from other sources as per Act. There can be a case of an investment company or even otherwise in a situation that investments are included in main objects clause in which case one may have good case to classify investments incomes such as interest dividends as business incomes following the ratio of the decision by the Allahabad high Court in 400ITR458. This was a case of a Real estate construction company having main objects of construction of mall and letting out of properties
Dispute arose whether letting out incomes are house property or business. Because of main objects entry it succeeded in classifying it as business income.
The Court therein held that according to the memorandum of association and articles of association, the main object of the business of the assessee was to construct mall and to derive income from letting out the shops therein. Therefore, the income so derived by the assessee would ultimately be the business income and as such the Assessing Officer had not committed any error in determining the taxable income of the assessee under the head “Income from business”.