Friday , July 20, 2018 |   12:15:34 IST
INTL TAXATION INTL MISC TP FDI LIBRARY VISA BIPA NRI
About Us Contact Us Instant Updates Newsletters
 
NEWS FLASH
 
TP - Treatment of certain expenses as operating revenue, for purpose of ALP determination, need not be decided u/s 260A being fact finding exercise - YES: HC (See 'Breaking News') TP - Outstanding receivables from AEs cannot be re-characterized as 'short term loan', without examining its impact on working capital of Indian taxpayer entity: ITAT (See 'Breaking News') TP - Failure to adopt correct margin of comparables during course of ALP determination, merits recall of matter for limited purpose of rectifying such ommission: ITAT (See 'Breaking News') I-T - Commission paid to agents abroad, for procuring export order overseas, does not attracts withholding tax liability u/s 195: ITAT (See 'Breaking News') I-T - Service tax collection by foreign shipping companies on behalf of Government, does not form part of their gross receipts u/s 44B since having no element of profit: ITAT (See 'Breaking News') TP - No reference can be made to TPO for determination of ALP once re-opening is initiated without AO disposing of assessee's objections to reopening: HC (See 'Breaking News') I-T - Interference with Settlement Commissionís findings is not permitted under Writ jurisdiction without any visible manifest error or non application of mind in such findings: HC (See 'Breaking News') India-Qatar DTAA - Exemption granted to interest derived by govt-owned financial agencies (See Notifications in 'Intl Taxation') I-T - Failure to issue notice u/s 143(2) in re-assessment proceedings prior to finalizing re-assessment order is not condonable u/s 292BB: ITAT (See 'Breaking News') TP - Modifications in selection of comparables based on functional & RPT filter is factual analysis & need not be challenged before writ court u/s 260A: HC (See 'Breaking News') TP - CUP is inappropriate for benchmarking international transaction of import made from AEs, if there are differences in dimensions of import made against AEs & third parties: ITAT (See 'Breaking News') TP - Entities undergoing extraordinary events of merger & amalgamation which hugely affect entire business model are not good comparables: ITAT (See 'Breaking News') I-T - Furnishing revised return to rectify omissions in original return is no basis to presume concealment, warranting penalty: ITAT (See 'Breaking News') GST Law Amendments - Will Council make it more taxpayer-friendly? (See 'Cob(Web)' in 'TIOL') TP - Product dissimilarity between two manufacturing entities makes them uncomparable for benchmarking international transaction: ITAT (See 'Breaking News') TP - Once there exists transaction between two AEs, it ceases to be 'uncontrolled transaction' & so goes out of reckoning under Rule 10B(1)(e)(ii): ITAT (See 'Breaking News') TP - Mere reimbursement of pass through costs incurred by Indian entity on behalf of its overseas AE does not entail any markup without any services being rendered: ITAT (See 'Breaking News') TP - In case of foreign company, AO is required to pass draft assessment order in terms of Sec. 144C, if he proposes to make variation in its returned income: HC (See 'Breaking News') Global Forum releases 7 peer review reports (See 'TII Brief')
 
TII SEARCH
 
 
   
Home >>
 

CBDT notifies method to determine FMV of unquoted equity shares
By TII News Service
Jul 12, 2017 , New Delhi

    

[TO BE PUBLISHED IN PART-II, SECTION 3 OF SUB-SECTION II OF THE GAZETTE OF INDIA]

GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
CENTRAL BOARD OF DIRECT TAXES
NEW DELHI

NOTIFICATION NO

61/2017, Dated: July 12, 2017

G.S.R. 865(E). - In exercise of the powers conferred by section 50CA and sub-section (2) of section 56 read with section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:-

1. (1) These rules may be called the Income-tax (20th Amendment), Rules, 2017.

(2) They shall come into force from the 1st day of April, 2018 and shall apply in relation to assessment year 2018-19 and subsequent years.

2. In the Income-tax Rules, 1962, -

(A) in rule 11UA, sub-rule (1), in clause (c), for sub-clause(b), the following sub-clause shall be substituted, namely:-

“(b) the fair market value of unquoted equity shares shall be the value, on the valuation date, of such unquoted equity shares as determined in the following manner, namely:-

the fair market value of unquoted equity shares =(A+B+C+D - L)× (PV)/(PE), where,

A= book value of all the assets (other than jewellery, artistic work, shares, securities and immovable property) in the balance-sheet as reduced by,-

(i) any amount of income-tax paid, if any, less the amount of income-tax refund claimed, if any; and

(ii) any amount shown as asset including the unamortised amount of deferred expenditure which does not represent the value of any asset;

B = the price which the jewellery and artistic work would fetch if sold in the open market on the basis of the valuation report obtained from a registered valuer;

C = fair market value of shares and securities as determined in the manner provided in this rule;

D = the value adopted or assessed or assessable by any authority of the Government for the purpose of payment of stamp duty in respect of the immovable property;

L= book value of liabilities shown in the balance sheet, but not including the following amounts, namely:-

(i) the paid-up capital in respect of equity shares;

(ii) the amount set apart for payment of dividends on preference shares and equity shares where such dividends have not been declared before the date of transfer at a general body meeting of the company;

(iii) reserves and surplus, by whatever name called, even if the resulting figure is negative, other than those set apart towards depreciation;

(iv) any amount representing provision for taxation, other than amount of income-tax paid, if any, less the amount of income-tax claimed as refund, if any, to the extent of the excess over the tax payable with reference to the book profits in accordance with the law applicable thereto;

(v) any amount representing provisions made for meeting liabilities, other than ascertained liabilities;

(vi) any amount representing contingent liabilities other than arrears of dividends payable in respect of cumulative preference shares;

PV= the paid up value of such equity shares;

PE = total amount of paid up equity share capital as shown in the balance-sheet;”

(B) after rule 11UA, the following rule shall be inserted, namely:-

“Determination of Fair Market Value for share other than quoted share.

11UAA. For the purposes of section 50CA, the fair market value of the share of a company other than a quoted share, shall be determined in the manner provided in sub-clause (b) or sub-clause(c),as the case may be, of clause (c) of sub-rule (1) of rule 11UA and for this purpose the reference to valuation date in the rule 11U and rule 11UA shall mean the date on which the capital asset, being share of a company other than a quoted share, referred to in section 50CA, is transferred.” .

[F. No. 149/136/2014-TPL]

Pravin Rawal, Director
Tax Policy and Legislation

Note: The principal rules were published in the Gazette of India Extraordinary, part III, section 3, sub-section (i), vide notification number S.O. 969(E), dated the, 26th March, 1962 and were last amended vide notification number G.S.R.No.826(E) dated the 4th July, 2017

 
 
INTL TAXATION INTL MISC TP FDI LIBRARY VISA BIPA NRI TII
  • DTAAs
  • TIEAs
  • Circulars
  • Circulars (I-T Act, 1922)
  • Instructions
  • Notifications
  • Administrative Orders
  • DRP Panel
  • I-T Act, 1961
  • Relevant Portion of I-T Rules,1962
  • Relevant Portion of I-T Act,1922
  • GAAR
  • Equalisation Levy
  • Draft Guidelines
  • Committee Reports
  • FATCA
  • Intl-Taxation
  • Finance Acts
  • Manual on EoI
  • DTC Bill
  • UN Model
  • Miscellaneous
  • Guidance Notes - AEOI
  • OECD Conventions
  • Cost Inflation Index
  • Union Budget
  • Information Security Guidelines
  • Draft Notifications
  • Circulars
  • Instructions
  • Notifications
  • Relevant Sections of Act
  • TP Rules
  • Forms
  • Miscellaneous
  • APA Annual Report
  • APA Rules
  • APA FAQ
  • UN Manual on TP
  • Safe Harbour Rules
  • US Transfer Pricing
  • FEMA Act
  • Exchange Manual
  • Fema Notifications
  • Master Circulars
  • Press Notes
  • Rules
  • RBI Circulars
  • FDI Circulars
  • Reports
  • FDI Approved
  • RBI Other Notifications
  • FIPB Review
  • Black Money Act
  • PMLA Notification
  • PMLA Instruction
  • PMLA Bill
  • FM Budget Speeches
  • SEBI
  • Multimodal Transportation
  • Vienna Convention
  • NBFC Reports
  • EXIM Bank LoC
  • Manufacturing Policy
  • FTDR Act, 1992
  • Intellectual Property
  • White Paper on Black Money
  • Posting Policy
  • PMLA Cases
  • Transfer of Property
  • CBR Act, 1963
  • MCA Circular
  • Book Review
  • Limitation Act
  • SSAs
  • EPFO
  • FAQs
  • Acts
  • Rules
  • Guidelines
  • Tourist Visa
  • Notifcations
  • Types of Visa
  • Agreements
  • Arbitration
  • Model Text
  • Relevant Portion of I-T Act
  • Circulars
  • I-T Rules, 1962
  • MISC
  • Notification
  • About Us
  • Contact Us
  •  
     
    A Taxindiaonline Website. Copyright © 2010-2018 Taxindiainternational.com Pvt.Ltd. All rights reserved.