Courts have ruled that a stock dividend is not taxable income to stockholders. What justifies this decision?

Question:

Courts have ruled that a stock is not taxable income to stockholders. What justifies this decision?

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...