10 per cent tax on capital gains to Holdings Co on sale of shares

Sudha Sharma appointed as Member of CBDT Rupee hits a high of 48.73 against Dollar Excise Officers caught burning official files in midight in Aligarh after Income Tax raids on Ponty Chadha SC cancels 122 licences issued by A Raja during his tenure as Telecom Minister Laxman Das is Officiating Chairman of CBDT Tariff Value for import of gold is 556 & for silver 1067 & for Brass Scrap 4078 & for poppy seeds 2205-Customs Non-Tariff Notification No. 10 Fused Silica is classifiable under Tariff Item 32074000-Customs Circular No.3 Additional Commisssioner of Income Tax HA Siddiqui sentenced to 4 years imprisonment for accepting bribe of Rs 1 Lakh by CBI Court in Delhi Exchange Rate for imported goods is Rs 50.20 Per US Dollar & Rs 66 per EURO-Exchange Rate for export goods is Rs 49.40 per US Dollar & Rs 64.40 per EURO HC upholds levy of service tax on booking of flats-The explanation which was inserted by the Finance Act of 2010 clearly brings within the fold of taxable service a construction service provided by the builder to a buyer where there is an intended sale between the parties whether before, during or after construction Authority for Advance Ruling rules super concentrates shall be classified as products of the chemical industry under heading 3824 90 90 of Customs Tariff Anti dumping duty imposed on import of Morpholine from China European Union & USA Anti dumping duty imposed on import of Geogrid/Geostrips/ Geostraps made of polyester or Glass fiber in all its forms from Refund of Anti-Dumping Duty (Paid in Excess of Actual Margin of Dumping) Rules, 2012 notified-Customs Non-Tariff Notification No.5 Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Amendment Rules, 2012-Customs Non-Tariff Notification No.6 Safeguard duty at the rate of 10% ad valorem notified on import of Phthalic anhydride, falling under tariff item 2917 35 00-Customs SG Notification No.1 Customs duty on import of Gold, Silver, Cut & Polished Diamonds hiked Customs duty to be charged at the rate of 2 per cent of Tariff Value on gold and 6 per cent of Tariff Value on silver Tariff Value for import of gold & silver notified-Customs Non-Tariff Notification No.3 Anti-dumping duty on imports ofSilk fabrics 20-100 gms per metre, falling under heading 5007 originating in, or exported from, China-CustomsTariff Notification No. 2 Anti-dumping duty imposed on imports of Nylon Filament Yarn, falling under Chapter 54 ,originating in, or exported from, China, Chinese Taipei, Malaysia, Thailand and Korea RP-Customs TariffNotification No.3 Anti-dumping duty imposed on import of Phosphoric Acid of allgrades and all concentrations (excluding Agriculture/Fertilizer Grade) ,falling under tariff item 28092010, originating in, or exported from, Israel and Taiwan-Customs Tariff Notification No.4 Anti-dumping duty on imports of Cellophane Transparent Film , falling under Chapter 39 , originating in, or exported from, China-Customs TariffNotification No.5 Anti-dumping duty onimports of Saccharin, falling under Chapters 29, 30, 33 and 38 ,originating in, or exported from, China-Customs Tariff Notification No.7 Special Bench of ITAT rules the appellant is not entitled to set off carry forward business loss against the long term capital gain arising on sale of land used for the purpose business ITAT rules Long Term and Short Term gains / losses on sale of equity shares under Portfolio Management Scheme is business income and not Capital Gains HC rules the opinion of the AO may have been legally erroneous but this cannot be a ground for initiation of re-assessment proceedings Anti-dumping duty on ‘Caustic Soda’, originating in, or exported from, Saudi Arabia, Iran, Japan, USA & France-Customs Tariff Notification No.1 Cost Accountants can issue Certificates for the purpose of refund of 4% CVD-Customs Circular No.1 Customs duty on import from ASEAN nations lowered- Customs Tariff Notification No.127 deeper tariff cut on import from Malaysia notified- Customs Tariff Notification No.128 deeper tariff cuts on import from Korea notified- Customs Tariff Notification No.123 deeper tariff cuts on import from Srilanka & Pakistan under SAFTA notified- Customs Tariff Notification No.125 Schedule of Rates for Service Tax Refund to Exporters notified in supersession of Notification No.17/2009-Service Tax Notification No. 52 Customs duty on import of several products from specified countries lowered-Customs Tariff Notification No.113 Anti-dumping duty on ‘Sodium Hydrosulphite (SHS)’, falling under headings 2831 and 2832 , originating in, or exported from, China PR- Customs Tariff Notification No.111 CBEC specifies documents required for Registration of ServiceTax Customs duty on import of 532 Products from Singapore lowered-many products exempted from duty-Customs Tariff Notification No. 106 Government allows Rebate of excise duty on export of goods to Nepal under ARE-1 Procedure w.e.f. 1st March 2012-Central Excise Non-Tariff Notification No.24

JUDGMENTS

CENTRAL EXCISE

CUSTOMS

exchange rate

SERVICE TAX

INCOME TAX

VAT

FINANCE ACTS

FINANCE BILLS

EOU STPI

SEZ

DGFT

RBI

NTT

RESOURCES

Email | Print

10 per cent tax on capital gains to Holdings Co on sale of shares

AIT News Network

NEW DELHI. Authority for Advance Rulings vide a significant ruling dated 28^th February 2008 AIT-2008-79-AAR has ruled that a resident applicant who is directly concerned with the issue of tax deduction at source in respect of payments made to the non- resident, is specified as one of the eligible applicants.

The tax payable on a long-term capital gains arisen to Moron Holdings PLC on the sale of originally acquired shares of Moron Tea Company (India) Ltd. will be @ 10% in consonance with the proviso to section 112(1) of the Income Tax Act of India.

Even in respect of sale consideration arising out of the bonus shares, the tax liability of the non-resident foreign company will be @ 10% only as per the proviso to section 112(1) of the Act.

Applicant purchased 15,20,000 equity shares of Moron Tea Company (India) Ltd. from Moron Holdings PLC, U.K. a non-resident company as per the sale & purchase agreement (in short SPA) executed between the purchaser (the applicant) and seller(Moron Holdings PLC, U.K.) on 18th January, 2007, wherein the purchaser agreed to purchase the said shares of Moron Tea Company held by the seller @ RS.273 per share. Out of the said shares, the original 5,18,000 shares were acquired by the seller in lieu of all the assets of the Moron Tea Ltd. (a U.K. company that was previously trading directly in India) on 6th April, 1979, after obtaining permission from RBI. Subsequently, as the facts bear out, Moron Tea Company issued 10,28,000 fully paid up equity shares of RS.101- each as bonus shares during the year 1990 and 1998. Thus, 15,20,000 shares (listed securities) sold by Moron Holding PLC U.K. to the applicant consisted of original as well as bonus shares acquired from Moron Tea Company. It is further stated that the effective date of agreement was extended till 7^th October 2007,and the sale consideration payable for the transfer of shares, was to the tune of Rs.41,49,60,000/-. As stated, the transfer of aforesaid shares could not be effected through the stock exchange. As such, the applicant authorized ICICI Bank Ltd. for arranging and remitting the sale proceeds amounting to Rs.33,24,06,160/- after deducting tax @ 20%, inclusive of the surcharge, on the long term capital gains. Accordingly, the sale proceeds were remitted to the seller on 1.10.2007 through 'Swift' (inter bank transfer). The shares were then credited through off market transaction in the Demat account of the purchaser after the transaction of sale was completed.

The applicant sought ruling from Authority on the following questions:

"1. Whether on the stated facts and in law, the tax payable on long term capital again arisen to Moran Holdings PLC on sale of originally acquired shares of Moran Tea Company (India) Limited will be 10% of the amount of capital gain as per Proviso to Section 112(1) of the Income Tax Act, 1961?

2. Whether on the stated facts and in law, the tax payable on long term capital gain arisen to Moran Holdings PLC on sale of bonus shares of Moran Tea Company (India) Limited will be 10% of the amount of capital gain as per Proviso to Section 112(1) of the Income-tax Act?

3. Whether on the stated facts and in law, the long term capital gain arisen to Morgan Holdings PLC on sale of originally acquired shares and bonus shares of Moran Tea Company (India) Limited are to be computed by applying Section 48 of the Income-tax Act without having regard to either the first or the second proviso to the Section?"

(Click here for full text of Ruling AIT-2008-79-AAR)

· Imports for Power Projects exempt from Additional duty: Advance Ruling

· Salary paid by Infosys to non-resident employee taxable: AAR

· 10 per cent tax on sale of original and bonus shares by Foreign Resident

· Profit from Portfolio Investment not business income

· No capital gains on amalgamation of the wholly owned subsidiary foreign company with its parent company

· Non resident agents rendering services outside India & getting payment outside India liable to income tax in India : Advance Ruling

· Authority Settles Tax on Capital gains by Real Estate Developers

· Profits of dealings with HO by MNCs branch taxable

· Payment to Parent MNC for cost of seconded personnel subject to withholding tax

· Payments at Singapore to access portal hosted from Singapore taxable in India

· Withhold taxes whilst paying to Microsoft for software: Advance Ruling

· Company’s Name cannot be substituted under Rule 20:Advance Ruling

· Holding Shares as investment not stock-in-trade

· No capital gains in assessee’s hand on sale of shares by lender: ITAT

· Loss on sale of shares held as investment is “capital loss”: ITAT

· Transfer of exchange card exigible to capital gains tax

· Redemption of stock appreciation rights Amount is income: Special Bench

· Admission fee & infra dev paid to exchange is Revenue Expenditure