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

WABCO-TVS (INDIA) LIMITED INFORMATION MEMORANDUM
year and so on. No loss shall be carried forward under this section for more than
eight assessment years immediately succeeding the assessment year for which
the loss was first computed.
6) As per section 111A of the IT Act, where the total income of an assessee includes
any income chargeable under the head “capital gains” arising from the transfer of
a short term capital asset, being an equity share in a Company or a unit of an
equity oriented fund and 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, then the tax payable by the assessee shall be the amount of
income tax calculated on such short term capital gains at the rate of 15%.
7) As per section 112 of the IT Act, taxable long-term capital gains, if any, on sale
of listed securities or units or zero coupon bonds which have not suffered
Securities transaction tax will be charged to tax at the rate of 20% (plus
applicable surcharge and education cess) after considering indexation benefits or
at 10% (plus applicable surcharge and education cess) without indexation
benefits, whichever is beneficial to the assessee. Under section 48 of the IT Act,
the long term capital gains arising out of sale of capital assets excluding bonds
and debentures (except Capital Indexed Bonds issued by the Government) will be
computed after indexing the cost of acquisition/ improvement.
III. Benefits available to Non-Resident Indians/Non-Resident Shareholders
(Other than FIIs and Venture Capital Companies / Funds):
1. As per section 10(34) of the IT Act, any income by way of dividends referred to in
section 115-O (i.e. dividends declared, distributed or paid on or after 1 April 2003
by the Company) received on the Equity Shares of the Company is exempt from
tax.
2. 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.
3. As per first proviso to section 48 of the IT Act, in case of a non resident
shareholder, the capital gain/loss arising from transfer of shares of the Company,
acquired in convertible foreign exchange, is to be computed by converting the
cost of acquisition, sales consideration and expenditure incurred wholly and
exclusively incurred in connection with such transfer, into the same foreign
currency which was initially utilized in the purchase of shares. Cost Indexation
benefit will not be available in such a case. As per section 112 of the IT Act,
taxable long-term capital gains, if any, on sale of long term capital assets of the
Company will be charged to tax at the rate of 20% (plus applicable surcharge
and education cess).
4. 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
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