dEAR sIR
WE ARE GOING TO FILE WITH ROC ON BEHALF OF CLIENT A COMPANY UNDER EASY EXIT SCHEME.
NOW EASY EXIT SCHEME WILL RESULT IN STRIKING OF NAME WITH ROC
IT IS NOTHING BUT LIQUIDATION
THE SHAREHOLDERS WILL GET MONEY ON LIQUIDATION.
THE COMPANY HAS SHARE CAPITAL RS.1 LAKH RESERVES OF 46 LAKH
ASSET SIDE RS.47 LAKH SHARES INVESTED IN SISTER / GROUP COS.
AS PER SECTION 2(22)C
ANY ACCUMULATED PROFITS DISTRIBUTED ON LIQUIDATION IS DIVIDEND LIABLE FOR DIVIDEND DISTRIBUTION TAX U/S 115-O [ AS RESERVES ARE RS.46 LAKHS HENCE DDT ]
AS PER SECTION 46(2)
ANY SURPLUS RECD REDUCED BY DIVIDEND WILL BE CAPITAL GAIN IN THE HANDS OF SHAREHOLDERS LIABLE FOR TAX
MY QWERY IS
AM I INTEREPRETING THE INCOME TAX ACT CORRECTLY FOR PAYMENT OF DIVIDEND DISTRIBUTION TAX U/S 115-O ?
OR IS THERE ANY OTHER PROVISION IN THE INCOME TAX STATING THAT SUCH A DIVIDEND IS TAX FREE ?
OR IT IS CAPITAL RECIEPT NOT TAXABLE IN THE HANDS OF SHAREHOLDERS ?
REGARDS
YOGESH MANTRI
CAclubindia
