Consideration received by a Company for issue of Shares that exceeds the face value not be computed as "Income from Other Sources"

In supersession of the Notification Number S.O. 1160 dated June 14, 2016 issued by Central Board of Direct Taxes (CBDT), the Board has notified that the provisions of clause (viib) of Section 56(2) of the Income-tax Act, 1961, which deals with income chargeable to income-tax under the head "Income from other sources", shall not apply to consideration received by a company for issue of shares that exceeds the face value of such shares, if the consideration has been received for issue of shares from an investor in accordance with the approval granted by the Inter-Ministerial Board of Certification under clause (i) of sub-para (3) of para 4 of the Notification Number G.S.R. 364(E), dated April 11, 2018 issued by the Department of Industrial Policy and Promotion.

This notification shall be deemed to have come into force retrospectively from the April 11, 2018.

[S.O. 2088(E)]

URL: http://www.egazette.nic.in/WriteReadData/2018/185818.pdf