Section 56(2)(vii)(c) not applicable to bonus shares as no Transfer of Property

DCIT Vs Tangi Facility Solutions Pvt Ltd (ITAT Chennai) ITAT held that Ld. CIT(A) has correctly relied on the cited decisions of Hon’ble Apex Court in CIT vs. Dalmia Investment Co. Ltd. (52 ITR 567) holding that issuance of bonus shares to equity shareholders do not amount to payment of dividend since the conversion of reserves into capital by issue of bonus shares do not involve release of profits to the shareholders and the said profits remain employed in the business. Similarly in Hansur Plywood Works Ltd. vs. CIT (229 ITR 112), it was held by Hon’ble Supreme Court that issuance of bonu...