Sec 56(2)(viia)

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Querist : Anonymous

Querist : Anonymous (Querist)

27 December 2011 cash received by a company as gift, whether cover under section 56(2)(viia).
if not, then what are the tax implications of such transaction.

Thanks

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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27 December 2011 Section 56(2)(viia) is applicable when a company or a firm receives as gift SHARES OF A PRIVATE COMPANY.

It does not apply to cash gifts received by a company or a firm.

Further, Section 56(2)(vii) is also not applicable since the said Section is applicable only to an individual or HUF.

Such cash gift shall be taxable as business income in the hands of the company.

Querist : Anonymous

Querist : Anonymous (Querist)

29 December 2011 ok.. Plz. tell me under which section of PGBP, it would be taxable and also give any reference book related to such case if possible.

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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30 December 2011 It will be chargeable to tax u/s 28 of the Income Tax Act.

Querist : Anonymous

Querist : Anonymous (Querist)

30 December 2011 Thanks Sir, but i have read sec.:28 from V.G Sir's book. i didn't get any reference of such type of cash gift. i am so confused sir, plz. give me any reference of another book, regarding this.. plz sir its so urgent....

Thanks.

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