CA. Rashi Goyal (Chartered Accountant) (512 Points)
25 July 2010Dear Friends,
An Indian company "A" is purchasing the shares of an Indian company "B" from a non resident at the agreed rate of Rs. 2.00 per share (Face value = Rs. 10.00 per shares). Now would the company "A" liable to deduct the TDS u/s 195 out of the money to be paid for purchasing the shares.
Pleae advise.
CA. Anuj Gupta
(Practices in NRI Int.Tax FEMA TP FDI/FIPB & FCRA)
(7024 Points)
Replied 04 April 2011
As per FEMA you cannot transfer the shares at value less than arrived at by DCF method.
Also if there is no capital gain invoved in the present case, then there is no question of TDS.
CAclubindia
