13 Points
Posted on 23 December 2010
Sir
my clients gained capital gain of Rs. 100.00 lacs on transfer of shares of a pvt. Ltd. company. As he was key emplyoee and also having 1% shares of the company. As per agreement 80% consideration was received by him in the financial year 2008-09. Remaining 20% was payable only if he continues in service of another company of same group. He remained service for next year and balance 20% consideration was received by him in the financiay year 2009-10. He paid tax/ made the tax planning accordingly.
His case is under scuritiny U/s. 143(3) for the financial year 2008-09. Can the Assistanct commissioner add 20% remuneration ( Rs. 20.00 Lacs) in the year 2008-09 on accrual basis. However the consideration was conditional and the same fact exists in the written agreement made between the company and employee.
Please do me guide as the case is fixed for hearing in next month.
Regards.
M.K.Chura. FCA