Capital gain

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

10 August 2012 Indian company has a subsidiary(Non-Resident) and it got merged with another Non-Resident company. Indian company got shares from the merged company in return of shares of subsidiary company. Whether there is any capital gain in this transaction.

Amol S Joglekar

Amol S Joglekar (Expert)
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10 August 2012 Yes. the gain shall be taxable in India.

srinath

srinath (Expert)
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10 August 2012
Exemption under section 47(vii) is available only if the amalgamated company is an Indian Company.

By virtue of amalgamation, ICO has extinguished its rights in FCO1 and as a result it shall be regarded as transfer.

The FMV of shares of FCO2 will be regarded as sale consideration uunder section 50D.

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