One of our client is a Pvt LTd Company and with authorized capital of 30Lakhs and subscribed capital of 20Lakhs, consisting of 20,000 share of 100 each, the major share holders of the company sold their shares (around 19000 shares) for a premium of 900Rs, to another person, My quiery is as both the parties involved including the pvt ltd company is our client, i neeed to know how to account the shares purchased in books of purchaser? and will the seller would be liable to capital gains? and also how to reflect these transaction in the books of company as the company has only the land & building in its book and doest not have any business started yet.
1)in the books of purchaser the same will be shown under the investment at the cost(i.e face value of shares + premium). 2)in the books of seller the capital gain will be applicable as exemption is only in respect of listed shares. 3) the above transaction will have no impact on accounting in the books of Company. however the same has to be reported in annual return of ROC
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