Page 371 - DCOM301_INCOME_TAX_LAWS_I

Income Tax Laws – I

Notes 10. Shares as gift: Where a firm or a company not being a company in which the public are
substantially interested, receives, in any previous year, from any person or persons, on or
after the 1st day of June, 2010, any property, being shares of a company not being a
company in which the public are substantially interested,
(a) without consideration, the aggregate fair market value of which exceeds fifty
thousand rupees, the whole of the aggregate fair market value of such property;
(b) for a consideration which is less than the aggregate fair market value of the property
by an amount exceeding fifty thousand rupees, the aggregate fair market value of
such property as exceeds such consideration :
Provided that this clause shall not apply to any such property received by way of a
transaction not regarded as transfer under clause (via) or clause (vic) or clause (vicb) or
clause (vid) or clause (vii) of section 47.

11. Share premiums in excess of the fair market value to be treated as income: Where a company,
not being a company in which the public are substantially interested, receives, in any
previous year, from any person being a resident, any consideration for issue of shares that
exceeds the face value of such shares, the aggregate consideration received for such shares
as exceeds the fair market value of the shares:
Provided that this clause shall not apply where the consideration for issue of shares is
received

by a venture capital undertaking from a venture capital company or a venture
capital fund; or
by a company from a class or classes of persons as may be notified by the Central
Government in this behalf.

Did u know? For the purposes of this clause,
(a) the fair market value of the shares shall be the value:

as may be determined in accordance with such method as may be prescribed;
or
as may be substantiated by the company to the satisfaction of the Assessing
Officer, based on the value, on the date of issue of shares, of its assets, including
intangible assets being goodwill, know-how, patents, copyrights, trademarks,
licences, franchises or any other business or commercial rights of similar
nature, whichever is higher;
(b) “Venture capital company”, “venture capital fund” and “venture capital
undertaking” shall have the meanings respectively assigned to them in clause (a),
clause (b) and clause (c) of Explanation 1 to clause (23FB) of section 10

12. Income by way of interest received on compensation or on enhanced compensation referred
to in clause (b) of section 145A.
In addition to the above there are some other incomes which are also chargeable under the head
‘Income from Other Sources’. For example:
1. Agricultural Income from land situated outside India.
2. All interest other than interest on securities, e.g. interest on bank deposits, interest on
loan, etc.

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