Section 56(2)(viia)

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bhushan gupta (Querist)
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10 October 2012 Whether section 56(2)(viia) is also applicable to fresh issue of share capital? A private company has issued recently fresh issue of equity shares Rs. 20 Lakh to a private company at Rs.10 having face value Rs.10/- although at the time of issue of fresh share capital book vaule of share is Rs.250/- Whether Rs.240/-(250-10) per share is income under section 56(2)(viia) of Income Tax Act,1961.

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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13 October 2012 Section 56(2)(viia) is applicable to each and every issue of shares to a firm or a private company.

Accordingly in the above case, Section 56(2)(viia) shall be applicable if more than 209 shares are issued.

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