Taxation of Dividends

·            Section 10(34) – Dividend Income Exempt from Tax

·            Section 115-O(1) – Tax on Distributed Profits of Domestic Companies

·            Section 115-O(1A)

·            Section 115P – Interest Payable for Non-payment of Tax by Domestic Companies

·            Section 115Q – When Companies is Deemed to be in Default

·            Section 271C – Penalty

·            Section 276B – Prosecution

·            Section 2(22)(e) – Loans and Advances by Closely Held Company Deemed as Dividend

·            Section 2(22) – Dividend Shall Not Include

·            Section 2(22)(a) – Distribution of Asset deemed as Dividend

·            Section 2(22)(b) – Distribution of Debentures etc. Deemed as Dividend

·            Section 2(22)(c) – Distribution of Asset Deemed as Dividend

·            Section 2(22)(d) – Distribution on Reduction of Share Capital Deemed as Dividend

·            Section 2(22) – Dividend Shall Not Include

·            Section 46 – Capital Gains on Distribution of Assets by Companies in Liquidation

·            Section55 – Sale of Assets Received on Liquidation

·            Section 46A – Capital Gains on Purchase by Company of its Own Shares or Other Specified Securities

New Pension Scheme

• Section 10 – Income of New Pension Scheme Trust Exempt From Tax
• Section 115-O(1A) – Reduction in Dividend Distribution Tax
• Section 80CCD – Deduction in Respect of Contribution to Pension Scheme of Central Government
• Section 197(1E) – No Deduction of Tax at Source to be Made in Certain Cases

Taxation of Income on Units

·         Section 10 – Income not Included in Total Income

-                      Section 10 (33)

-                      Section 10 (35)

• Section 115R – Tax on Distributed Income to Unit Holders
• Section 115S – Interest Payable for Non-Payment of Tax
• Section 115T – Specified Company or Mutual Fund to be Assessee in Default

Dividend Stripping

• Section 94(7) – Measures to Curb Dividend Stripping

Bonus Stripping

• Section 94(8) – Measures to Curb Bonus Stripping

Taxability of Deep Discount Bonds

• Circular No. 2/2002 – Clarification Regarding Tax Treatment of Deep Discount Bonds and STRIPS
• Press Note Dated 20.03.2002 – Further Clarification on Tax Treatment of Deep Discount Bonds and STRIPS
• Circular No. 4/2004 – Tax Deduction at Source on Income From Deep Discount Bonds

Zero Coupon Bonds Related Sections

·         Section 2(48)

·         Section 2(47)

·         Section 2(42A)

·         Section 112

·         Section 194A

·         Section 36(iiia)

Annual Information Return

• Section 285BA – Obligation to furnish Annual Information Return
• Section 271FA – Penalty for Failure to Furnish Annual Information Return
• Rule 114E – Furnishing of Annual Information Return

Amalgamation And Its Tax Implications

• Section 2(1B)– Definition Of Amalgamation
• Taxation Of Shareholders

-                      Section 47

-                      Section 49(2)

-                      Section 2(42A)

• Taxation Of Amalgamating Company

-                      Section 47

• Taxation Of Amalgamated Company

-                      Section 49(1)

-                      Section 55

-                      Section 2(42A)

-                      Section 35

-                      Section 35A

-                      Section 35ABB

-                      Section 35D

-                      Section 35DD

-                      Section 36(1)(ix)

-                      Section 35DDA

-                      Section 41(1)

-                      Section 42

-                      Section 43C

-                      Section 32

-                      Explanation 7 to Section 43(1)

-                      Explanation 13 to Section 43(1)

-                      Explanation to Section 43(6)

-                      Section 10A/ 10B/ 10AA/ 80-IA/ 80-IB/ 80-IC/ 80-IE

• Section 72A– Provisions Relating To Carry Forward And Set Off Of Accumulated Losses And Unabsorbed Depreciation Allowance In Amalgamation Or Demerger, Etc.
• Section 72AA– Provisions Relating To Carry Forward And Set-Off Of Accumulated Loss And Unabsorbed Depreciation Allowance In Scheme Of Amalgamation Of Banking Company In Certain Cases
• Section 47– Certain Transactions Not Regarded As Transfer

Demerger And Its Tax Implication

• Amendments Made In The Chapter Of Capital Gains

-                      Section 2(22)

-                      Section 47

-                      Section 2(42A)

-                      Section 49

• Amendments Made In The Chapter Of Profits And Gains Of Business Or Profession

-                      Explanation 7A to Section 43(1)

-                      Explanation 2A to Section 43(6)

-                      Explanation 2B to Section 43(6)

-                      Section 32

• Taxation Of Shareholders Of Demerged Company And The Resulting Company

-                      Section 47(vid)

-                      Section 2(22)(v)

-                      Section 2(42A)

-                      Section 49(2C)

-                      Section 49(2D)

• Taxation Of Resulting Company

-                      Explanation 7A to Section 43(1)

-                      Explanation 13 to Section 43(1)

-                      Explanation 2B to Section 43(6)

-                      Section 32

-                      Section 72A

-                      Section 35A

-                      Section 35ABB

-                      Section 35D

-                      Section 35DD

-                      Section 35DDA

-                      Section 42

-                      Section 41(1)

-                      Section 10A/ 10B/ 10AA/ 80-IA/ 80-IB/ 80-IC/ 80-IE

• Taxation Of Demerged Company

-                      Section 47(vib)

-                      Section 47 (vic)

-                      Explanation 2A to Section 43(6)

-                      Section 32

-                      Section 72A

Business Reorganisation Of Co-Operative Banks

• Section 47– Transactions Not Regarded As Transfer.
• Section 49– Cost Of Acquisition
• Section 2(42A)– Period Of Holding
• Section 55– Cost Of Acquisition
• Section 72AB– Provisions Relating To Carry Forward And Set Off Of Accumulated Loss And Unabsorbed Depreciation Allowance In Business Reorganisation Of Co-Operative Banks
• Section 44DB– Special Provision For Computing Deductions In The Case Of Business Reorganization Of Co-Operative Banks

Demerger Of Co-Operative Bank

• Section 47– Transactions Not Regarded As Transfer.
• Section 49– Cost Of Acquisition
• Section 2(42A) – Period of Holding
• Section 55 – Cost of Acquisition
• Section 72AB– Provisions Relating To Carry Forward And Set Off Of Accumulated Loss And Unabsorbed Depreciation Allowance In Business Reorganisation Of Co-Operative Banks
• Section 44DB– Special Provision For Computing Deductions In The Case Of Business Reorganization Of Co-Operative Banks

Set-Off, Or Set-Off And Carry Forward Of Losses

• Section 70– Set-Off Of Loss From One Source Against Income From Other Source Under The Same Head Of Income

• Section 71– Set-Off Of Loss From One Head Against Income From Another Head
• Section 71B – Carry Forward And Set-Off Of Loss From House Property
• Section 72 – Carry Forward & Set-Off Of Business Losses
• Section 73 – Losses In Speculation Business
• Section 73A – Carry Forward and Set-off of Losses by Specified Business Referred in Section 35AD
• Section 74 – Losses Under The Head Capital Gains
• Section 74A – Loss From The Activity Of Owning And Maintaining Race-Horses
• Section 78 – Carry Forward And Set Off Of Losses In Case Of Change In Constitution Of Firm Or On Succession
• Section 79 – Carry Forward And Set-Off Of Losses In The Case Of Certain Companies

Stock Options

·         Section 17(2)(vi) – Perquisite in respect of Stock Options

·         Rule 3(8) – Valuation of Perquisites in Respect of Equity Shares Allotted or Transferred under Employee Stock Option Plan

·         Rule 3(9) – Valuation of Perquisites in respect of Securities Other Than Equity Shares Allotted or Transferred under Employee Stock Option Plan

·         Section 2(42A) – Period of Holding

·         Section 49(2AA) – Cost of Acquisition

Valuation of Perquisite

·         Section 17(2) – Definition of Perquisite

·         Rule 3 – Valuation of Perquisite