Tds on buy back of shares by pvt ltd company

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Querist : Anonymous

Querist : Anonymous (Querist)

19 November 2013 IN TERMS OF SECTION 402(C) OF THE COMPANIES ACT, BY ORDER OF THE CLB, THE PVT LTD COMPANY IS GOING TO BUY BACK ITS SHARES FROM THE EXISTING SHARE HOLDERS, WHAT IS THE TDS IMPLICATION UNDER THE INCOME TAX ACT, IF THE EXISTING SHARE HOLDERS ARE NRI AND RESIDENT OF INDIA

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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19 November 2013 no tds for resident share holder.
for nri refer sec 195.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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20 November 2013 there is no TDS provision. However, where a company buying back its shares which are not listed the stock exchanges, section 115QA shall apply and Company shall be liable to pay tax at 20% on the distributed income. Once such tax is paid, the incoming arising out of buyback shall be exempt in the hands of the receiver.

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