Purpose: The purpose of the study is to analyze motivation behind payment of cash dividend by the firms in India in presence of tax provision that discourages payment of dividend by imposing tax on firms at the time of distribution.Design/methodology/approach First, consistent with Jensen's...

This article evaluates the efficiency of existing dividend distribution tax in India from the perspective of investors’ preference pattern, as revealed in the market. It investigates the announcement effect of dividend in India in the presence of dividend distribution tax with specific...