Amount forfeited out of Share Capital is “Capital Receipt”, Not Taxable u/s 56(2)(ix) of Income Tax Act: ITAT [Read Order]

By Taxscan Team - On May 9, 2023 2:30 pm - 2 mins read

Amount forfeited - Share Capital - Amount forfeited out of Share Capital - Capital Receipt - Taxable - Income Tax Act - ITAT - Income Tax - taxscan

The Income Tax Appellate Tribunal (ITAT), Mumbai bench has held that the amount forfeited out of share capital would amount to “capital receipt” and therefore, the provisions of section 56(2)(ix) of the Income Tax Act, 1961 shall not be applicable. The assessee Mangal Credit and Fincorp Ltd, a non-banking financial company, approached the ITAT challenging…

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