WABCO-TVS (INDIA) LIMITED INFORMATION MEMORANDUM ...

WABCO-TVS (INDIA) LIMITED INFORMATION MEMORANDUM
“Administrator” means the Administrator as referred to in section 2(a) of
the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 (58
of 2002) and (ii) “Specified Company” means a Company as referred to in
section 2(h) of the said Act.
4. As per section 10(38) of the IT Act, any income arising from the transfer of a
long term capital asset, being an equity share in a Company or a unit of an
Equity Oriented Fund where the transaction of sale of such equity share or unit is
entered into on or after the date on which Chapter VII of the Finance Act, 2004
comes into force and such transaction is chargeable to securities transaction tax
under that chapter shall not be included in the total income of the assessee.
However, while calculating the book profits for the purpose of Section 115 JB of
the IT Act, the long term capital gains to which the provisions of Section 10(38)
of the IT Act apply will have to be included and the company will be required to
pay, on book profits, MAT @ 10% plus applicable surcharge viz., 10% of the tax
payable and education cess of 3% on the tax and surcharge.
5. The Company is entitled to claim additional depreciation @ 20% (10% if the
assets are used for less than 182 days) of the actual cost in accordance with
provisions of section 32(1)(iia) for the purchase of specified new plant and
machinery acquired and installed after 31 st March 2005.
6. In accordance with and subject to the provisions of Section 35 of the IT Act, the
Company would be entitled to deduction in respect of expenditure laid out or
expended on scientific research related to the business and on any amount paid
to any scientific research association which has as its object the undertaking of
scientific research or to a university, college or other institution to be used for
scientific research.
7. In accordance with the provisions of section 35DD of the IT Act, expenditure
incurred wholly or exclusively for the purpose of amalgamation or demerger of an
undertaking, after 1 st April 1999 the Company shall be allowed a deduction of an
amount equal to one fifth of such expenses for each of the five consecutive
previous years beginning with the previous year in which the amalgamation or
demerger takes place.
8. As per section 54EC of the IT Act and subject to the conditions and to the extent
specified therein, where the capital gain arises from the transfer of a long term
capital asset (the capital asset so transferred being hereafter in this section
referred to as the original asset) and the assessee has, at any time within a
period of six months after the date of such transfer, invested the whole or any
part of capital gains in the Long Term Specified Asset, the capital gain shall be
dealt with in accordance with the following provisions of this section: if the cost
of the Long Term Specified Asset is not less than the capital gain arising from the
transfer of the original asset, the whole of such capital gains shall not be charged
u/s 45 and if the cost of the long term capital asset is less than the capital gains
arising from the transfer of the original asset, so much of the capital gain as
bears to the whole of the capital gain the same proportion as the cost of
acquisition of the long term capital asset bears to the whole of the capital gain,
shall not be charged u/s 45. Provided that the investment made on or after the
1 st day of April 2007, in the Long Term Specified Asset by an assessee during any
financial year does not exceed fifty lakh rupees.
9. As per section 74 of the IT Act, Where in respect of any assessment year, the net
result of the computation under the head “Capital gains” is a loss to the
assessee, the whole loss shall, subject to the other provisions of this Chapter, be
carried forward to the following assessment year, and in so far as such loss
relates to a short-term capital asset, it shall be set off against income, if any,
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