| Question And Answer | |
|---|---|
| Subject: | Applicability of section 56(2)(x) in the hands of the firm on partners capital contribution in kind |
| Category: | Income-Tax |
| Querist: | Ajoy |
| Answered by: | Reply of the Expert is awaited; |
| Tags: | section 56(2)(x) |
| Date: | June 15, 2024 |
Mr. A, a partner in a firm ABC, wants to contribute shares of an unlisted entity held by him as his capital contribution in the firm. The FMV of the shares is Rs. one crores whereas it is being recorded at Rs. 5,00,000 in the books of the firm, being the cost in the hands of the partner.
Under section 45(3), there will be no incidence of tax in the hands of the contributing partner. Whether the firm can be held liable for tax on Rs. 95,00,000 under section 56(2)(x) on the difference between FMV and recorded in the books of the firm?
Reply of the Expert is awaited. Please check back later
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