RED HERRING PROSPECTUS Dated August 24 ... - Globus Spirits

TAX BENEFITS
The tax benefits listed below are the possible benefits available under the current tax laws in
India. Several of these benefits are dependent on the Company or its Shareholders fulfilling the
conditions prescribed under the relevant tax laws. Hence the ability of the Company or its
Shareholders to derive the tax benefits is dependent upon fulfilling such conditions, which based
on business imperatives it faces in the future, it may not choose to fulfil.
I. SPECIAL TAX BENEFITS
The Company and the shareholders enjoy no special tax benefits.
II.
GENERAL TAX BENEFITS
As per the existing provisions of the I T Act and other laws, as applicable for the time being in
force, the following general tax benefits and deductions are and will, inter alia, be available to
the Company and its prospective shareholders:
A. BENEFITS AVAILABLE UNDER THE INCOME TAX ACT, 1961
(i)
TO THE COMPANY:
1. Dividends exempt under Section 10(34)
Dividend income (whether interim or final), in the hands of the company as distributed
or paid by any other Company, on or after April 1, 2003 is completely exempt from tax
in the hands of the Company, under section 10(34) of the IT Act.
2. Depreciation under Section 32
As per provisions of section 32 (1) (ii. a) of the Income Tax Act, 1961 the company
would be entitled to additional depreciation @ 20% of the actual cost of new Plant &
Machinery during precious year ending on or after 31.03.2005 subject to the fulfilment
of other conditions specified under the said section.
3. Income from units of Mutual Funds exempt under Section 10(35)
The Company will be eligible for exemption of income received from units of mutual
funds specified under Section 10(23D) of the Act, income received in respect of units
from the Administrator of specified undertaking and income received in respect of units
from the specified company in accordance with and subject to the provisions of Section
10(35) of the Act.
4. Premium Paid on Health Insurance under Section 36(1)(ib)
In terms of section 36(1)(ib) of the Act, with effect from April 1, 2007, the amount of
any premium paid by cheque by the assessee as an employer to effect or to keep in
force an insurance on the health of his employees under a scheme framed in this behalf
by:
a) the General Insurance Corporation of India formed under section 9 of the
General Insurance Business (Nationalisation) Act,1972 and approved by the
Central Government; or
b) any other insurer and approved by the Insurance Regulatory and Development
Authority established under sub-section (1) of section 3 of the Insurance
Regulatory and Development Authority Act, 1999
is deductible expenditure and will accordingly apply in relation to the assessment year
2007-08 and subsequent years.
5. Exemption of Long-Term Capital Gain under Section 10(38)
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