Example 1

Suppose  a Company has authorized share capital of Rs 100000 (10000 shares @ 10 each)

Suppose it issue its shares to shareholders @ 15 each (Rs 10 par value and Rs 5 Premium)

What is treatment in Income Tax of Rs 5 per share extra received?

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Example 2

Suppose  a Company has authorized share capital of Rs 100000 (10000 shares @ 10 each)

Suppose it issue its shares to shareholders @ 8 each (Rs 10 par value and Rs 2 Discount)

FMV of Share is Rs 7

What is taxable treatment?

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  1. Income Tax
  2. Income from Other Sources
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About the Author

CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 8 years. He provides courses for Practical Accounts, Taxation and Efiling at teachoo.com .
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