Slump Sale and its taxability

Slump Sale - Meaning A Slump Sale is a sale of one or more undertakings by a seller as a going concern to an acquirer, for a lumpsum consideration, without specific values being assigned to individual assets. The concept of Slump Sale was introduced in the income tax law through section 2(42C) [definition of Slump … Continue reading Slump Sale and its taxability

Implications of Change in Beneficial Shareholding

Whether you are buying a business, selling a business or merging two or more businesses, there are multifarious tax issues that need to be navigated. It is crucial to know what you are getting in to when you decide to grow your business through Mergers and Acquisitions (‘M&A’). In any M&A transaction, tax considerations are … Continue reading Implications of Change in Beneficial Shareholding

Capital Expenditure vs Revenue Expenditure

The question about the nature of expenditure has always been a highly contested issue in tribunals and courts in India. Characterising an expenditure as revenue or capital has tax implications. Revenue expenditure is taken into account while computing taxable profits and would be eligible for a tax deduction whereas on capital expenditure only depreciation can … Continue reading Capital Expenditure vs Revenue Expenditure

A Question Of Strategy

If you have been following this blog, you know what a question of law is. Much of the outcome of an important case hinges on it. The entire judicial system in a sense revolves around what is the best way to interpret questions of law. Another question The question to ask though is: As a … Continue reading A Question Of Strategy

Anatomy of an Indian Tax Case

A judgment, ideally, is a prime example of how one should structure any piece of text, especially legal texts. It is supposed to be coherent and concise, and importantly, follow a trail that takes the reader smoothly from one point to the other. While a judgment may simply seem like a collection of legalese to … Continue reading Anatomy of an Indian Tax Case

Unexplained cash credits: 5 questions and their answers

Section 68 is one of the few sections in the Income Tax Act of 1961 which has largely remained unchanged. Apart from addition of provisos to cover corporate taxpayers, the purpose of the section has remained unchanged. So what does section 68 say? Amounts credited to an assessee are taxable unless the Act has specifically … Continue reading Unexplained cash credits: 5 questions and their answers

The Right Markup: A study on Transfer Pricing in Private Equity

Private Equity (PE) funds have been a part of India’s emerging story for more than a decade where many investments have now moulded the investment climate in India. In this article we will look at some of the issues faced by the Indian affiliates of global PE funds with respect to Transfer Pricing regulations in … Continue reading The Right Markup: A study on Transfer Pricing in Private Equity

Curious Case of Long-term Capital Gains tax exemption

In the Finance Act of 2004, the then finance minister introduced the Securities Transaction Tax (STT) on sale of equity shares and simultaneously provided an exemption, under Section 10(38) of the Act from payment of Long-term Capital Gains tax (LTCG) if STT was paid on the sale transaction.   The current finance minister has made … Continue reading Curious Case of Long-term Capital Gains tax exemption

Stay applications and their issues

Stay applications can provide relief to taxpayers who have been served a tax demand. This demand has to be paid within 30 days, after which the Department can take coercive action to recover that demand. Now, either you can pay the amount or you can appeal against the notice and during the pendency of the appeal, … Continue reading Stay applications and their issues