Sec.56 (2)(viia)
This query is : Resolved
20 February 2015
Whether buy back of share by an unlisted co. is covered under sec. 56 (2)(viia),(if made at a price lower than fair value) if yes whether any case law is there.
20 February 2015
No, in my view it will not cover the buy back of shares.
Because of the reason that the company does not receive its shares, but only cancels its share capital pursuant to the powers conferred on it under the Companies Act. In fact, the Companies Act does not permit a company to hold its own shares. Even if one were to say that a company receives its own shares on buyback or cancellation of shares, it is for the limited purpose of cancellation of those shares and therefore the company does not actually ‘receive’ any property, in the nature of shares.
Because of the reason that the company does not receive its shares, but only cancels its share capital pursuant to the powers conferred on it under the Companies Act. In fact, the Companies Act does not permit a company to hold its own shares. Even if one were to say that a company receives its own shares on buyback or cancellation of shares, it is for the limited purpose of cancellation of those shares and therefore the company does not actually ‘receive’ any property, in the nature of shares.
20 February 2015
And I think no case of such type has been come in view of public.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- REGARDING GST ON COMMERICIAL PROPERTY
- 15ca /15cb whose income tax login? remitter or nri seller's login?
- GST on export of services and Input Credit
- TDS U/S. 194NF
- ITC temporary reversal and reclaim
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- Regarding Documentation & Compliances for Opening of Unit of Pvt Ltd.
- Applicable TDS rate for sale of property in Nov 2024
- Should I report my US salary for January, February, March in Schedule FA?
- Can a partnership firm become partner in a LLP ?
- Quiery in relation to GST liability in case of an advocate who has obtained GST registration.
- LAST YEAR 2022-23 ITC IN NEXT YEAR 2023-24 REPORITNG IN GSTR-9
- MIS MATCH OF INVOICE NUMBER
- IGST Credit-Show cause notice issued-confusion
- TDS on purchase of value vouchers for employees ?
- Issue of gst e invoice
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
Trending Online Classes
CAclubindia
