Income Tax : Transaction of sale of Unquoted equity shares will result in double taxability of difference between the FMV and transaction Valu...
Income Tax : Company ♦ Section 115QA, which provides for the levy of tax, on account of buy-back of shares, at an effective rate of 23.296% (...
Income Tax : Section 50CA Special provision for full value of consideration for transfer of share other than quoted share Section 50CA of Incom...
Income Tax : Capital reduction refers to corporate reorganisation activity in which the existing share capital is extinguished. Companies consi...
Income Tax : Section 50CA provides for adoption of the value to be determined as per the Rules, (for convenience sake referred to by me as FMV ...
Income Tax : Bombay Chartered Accountants' Society has made a Representation on 'Suggestions for Amendments in the Income Tax Act', on 24th May...
Income Tax : CBDT has released the draft rules prescribing ‘unquoted shares’ valuation for purposes of Sec. 56(2)(x)/50CA (an important dev...
Income Tax : Bombay High Court ruling states that capital gain tax is not applicable on the transfer of shares as a gift. Detailed analysis and...
Income Tax : Delhi High Court held that reopening of assessment liable to be quashed as PCIT simply rubber-stamped the attempt of AO to reopen ...
Income Tax : ITAT Pune held that omission of claiming long term capital loss at the time of filing of original return was not bona fide. Accord...
Income Tax : New Income TAx Rule 11UD- Prescribed class of persons for the purpose of section 50CA i.e to whom provisions of section 50CA s...
Income Tax : Determination of Fair Market Value for share other than quoted share. 11UAA. For the purposes of section 50CA, the fair market val...
Increase in safe harbour limit of 5% under section 43CA, 50C and 56 of Income Tax Act, 1961 to 10% Section 43CA of the Income Tax Act, inter alia, provides that where the consideration declared to be received or accruing as a result of the transfer of land or building or both, is less than […]
Compilation of Section 47(iii), section 56(2)(x)(c), 50D & 50CA -Corporate gifts- an allowable transaction under Income tax? Purpose of section 56 defeated by the ITAT judgement? Brief overview of the judgement delivered On October 4, 2019, in a recent judgement of M/s Direct Media Distribution Ventures Private Limited v/s Principal Commissioner of Income Tax (ITA No: 2211/Mum/2019),the Mumbai bench […]
As per Section 56(2)(x) of the Income Tax Act, any person receives any property including shares of a company for a consideration less than the Fair Market Value, the Fair Market Value exceeding the consideration would be taxable in the hands of the person receiving such property. Clause 11 of proviso to Sec 56(2) (x) […]
New Income TAx Rule 11UD- Prescribed class of persons for the purpose of section 50CA i.e to whom provisions of section 50CA shall not apply to transfer of any movable property, being unquoted shares, of a company and its subsidiary and the subsidiary of such subsidiary by an assessee in certain circumstances. Notification No. 42/2020-Income […]
Valuation refers to the process of determining the present value of the asset being valued. The need for valuation of shares arises while performing certain transactions such as issue of further shares in the form of Right shares, merger and acquisitions, transfer of undertaking, etc. Valuation is usually performed by Chartered Accountant, Cost Accountant, SEBI […]
Interplay between Section 50C, 50CA, 43CA and 56(2) of Income Tax Act, 1961 The above sections are meant for taxing the persons who are in the intention of selling the assets at a price less than stamp duty value / fair market value. The above said sections are drafted in a lucrative way to the […]
It is a well settled and in substance a legal precedent that what is subject to tax is a real income. The principle of real income has been subject matter of intrinsic litigation in past and the possibility of probable dispute on the scope of what constitutes real income in days to come cannot be completely ruled out despite there have been series of amendments/clarification brought into the existing provisions of the Income Tax Act 1961 (the Act).
The existing provisions of the section 56(2)(x) of the Income-tax Act, inter alia, provide for chargeability of income in case of receipt of money or specified property for no or inadequate consideration. For determining the amount of income for receipt of certain shares, the fair market value of the shares is taken into account. Similarly, […]
Bombay Chartered Accountants’ Society has made a Representation on ‘Suggestions for Amendments in the Income Tax Act’, on 24th May, 2019, to the Joint Secretary TPL, Central Board of Direct Taxes, Ministry of Finance, Government of India.
The Finance Act, 2017 has introduced two important sections in the Income tax Act, 1961, with the intent of curbing perceived tax abuse: section 56(2)(x) and section 50CA. While the existing anti-abuse section, i.e., section 56(2)(vii) was applicable only in case of individuals, HUF, firms and unlisted companies; section 56(2) (x) has been incorporated to […]
