Financial Daily from THE HINDU group of publications
Sunday, Oct 12, 2003
Financial Daily from THE HINDU group of publications Sunday, Oct 12, 2003 |
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Investment World
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Income Tax Columns - Tax Talk Effects of buyback price revision
I have offered the capital gain resulting on the buyback taking the consideration as Rs 350 per share to tax in the assessment year 2001-02 (previous year 2000-01, the year of buyback). In June 2002, Castrol Ltd paid a further sum of Rs 69 per share under directions of the Court. How is this sum taxable and in which year? A. Mittal Reply The capital gains on transfer of shares by way of buy back will be chargeable under Section 46A of the Act. Such capital gain arises in the year in which the company purchases the shares. In the reader's case, therefore, the capital gains will arise in the assessment year 2001-02 as that will be the assessment year relevant to the previous year of buyback. Though a sum of Rs 69 was received in the subsequent year the same will also have to be added as part of consideration in determining the capital gains for the assessment year 2001-02. The consideration per share would therefore have to be taken as Rs 419 per share and the capital gains computed on that basis. The reader had already filed a return, and he will not be able to file a revised return even if the original return has been filed in time as the time for filing the revised return has expired. The time for filing a revised return is one year from the end of the relevant assessment year or before completion of assessment whichever is earlier. The said one year from the end of the relevant assessment year has already expired on 31.03.2003. The reader may, however, proceed to file the revised return which though invalid can be regularised by the Assessing Officer by the issue of a notice u/s.148. Query I have invested Rs 15,000 in deposits of ICICI Bank Ltd. The interest accrues yearly on these deposits. The bank has sent me a Form 15H and stated that if the same is given by me tax would not be deducted on the interest. Since my income exceeds the maximum amount not chargeable to tax and since I am a taxpayer I have not given the form to the Bank. Can I offer the interest from the deposit as my income and claim against the same a deduction u/s.80L, which would therefore result in a refund of the TDS. K. R. Sivakumar Reply The reader is right in not giving the Form 15H to the bank. The reader can claim deduction under Section 80L against the interest income up to a maximum of Rs 12,000 and if this results in a refund of tax, the same can be claimed by the reader. Business Line invites queries on personal taxation issues to this column. Queries may be sent to `Tax Talk', Kasturi Buildings, 859, Anna Salai, Chennai-600002, or by e-mail to taxtalk@thehindu.co.in (Readers are requested to mention `Tax talk' in the subject line of their e-mails.)
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