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2020 (10) TMI 521 - HC - Income TaxCapital gain computation - conversion of bonds into shares - foreign currency convertible bonds - Assessing Authority concluded that cost of acquisition of share has to be assessed at ₹ 200/- per share and not at ₹ 873.83 and ₹ 858.08 per share as claimed by the assessee and completed the assessment - HELD THAT:- The Central Government has issued the scheme viz., issue of foreign currency convertible bonds and ordinary shares (through Depository Receipt Mechanism) Scheme, 1993. The aforesaid scheme has been made applicable for the Assessment Year 2002-03 onwards vide notification dated 10.09.2002. Cost of acquisition has to be determined as per provisions of Clause 7(4) of the Scheme for computation of capital gains. It is also pertinent to mention here that Clause (xa) of Section 47, which refers to transfer by way of conversion of bonds has been inserted with effect from 01.04.2008 which is applicable to the Assessment Year 2009-10 onwards. Bonds issued to the petitioner were issued under the FCCB scheme and the conversion price determined on the basis of price of shares at Bombay Stock Exchange or National Stock Exchange on the date of conversion of FCBBs into shares. It is also pertinent to mention here that there is no conflict between the provisions of the scheme and the Acts / Rules. We respectfully agree with the view taken in KINGFISHER CAPITAL CLO LTD. [2019 (4) TMI 106 - BOMBAY HIGH COURT] and therefore, answer the substantial question of law against the revenue and in favour of the assessee.
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