CA P C YADAV (AUDIT MANAGER) (37 Points)
02 June 2016Dear Sir
i want to know that whether a new company can issue equity share at premium under co act 2013
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 02 June 2016
There is no bar in Companies Act. But you have to take care of Sec.56(viib) of Income Tax Act 1961. Amount in excess of fair market value of shares will be treated as other income and will be taxed accordingly.
Senu Reddy
(ca final)
(291 Points)
Replied 02 June 2016
how will be thefair market value determined, whether it is based on Net asset value or any other method
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 02 June 2016
You have to refer to Rule 11U and 11UA for the methodology and take CA certificate for valuation under the rules.
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