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Section – 49 -Cost of acquisition in Tax neutral demerger of a foreign company -

 

Under the existing provision of section 47(vic), the transfer of shares of an Indian company by a demerged foreign company to a resulting foreign company is not regarded as transfer.

 

It is proposed to amend section 49 so as to provide that cost of acquisition of the shares of Indian company referred to in section 47(vic) in the hands of the resulting foreign company shall be the same as it was in the hands of demerged foreign company.

 

The amendment will be effective from 1st April 2018.


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