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TMI Blogsection 47 (Xiiib)X X X X Extracts X X X X X X X X Extracts X X X X ..... section 47 (Xiiib) X X X X Extracts X X X X X X X X Extracts X X X X ..... company by a shareholder as a result of conversion of the company into a limited liability partnership in accordance with the provisions of section 56 or section 57 of the Limited Liability Partnership Act, 2008[6 of 2009.]: Provided that-- (a) all the assets and liabilities of the company immediately before the conversion become the assets and liabilities of the limited liability partnership; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (b) all the shareholders of the company immediately before the conversion become the partners of the limited liability partnership and their capital contribution and profit sharing ratio in the limited liability partnership are in the same proportion as their shareholding in the company on the date of conversion; (c) the shareholders of the company do not receive any consideration or benefit, dir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ectly or indirectly, in any form or manner, other than by way of share in profit and capital contribution in the limited liability partnership; (d) the aggregate of the profit sharing ratio of the shareholders of the company in the limited liability partnership shall not be less than fifty per cent. at any time during the period of five years from the date of conversion; (e) the total sales, tur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nover or gross receipts in business of the company in any of the three previous years preceding the previous year in which the conversion takes place does not exceed sixty lakh rupees; and (f) no amount is paid, either directly or indirectly, to any partner out of balance of accumulated profit standing in the accounts of the company on the date of conversion for a period of three years from the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate of conversion. Explanation.--For the purposes of this clause, the expressions "private company" and "unlisted public company" shall have the meanings respectively assigned to them in the Limited Liability Partnership Act, 2008[6 of 2009.]: what is the meaning of business in clause (e) above. whether in an investment company dividend income will be considered as part of Rs 60 lakhs or no.? R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eply By Surender Gupta: The Reply: The terms (total sales, turnover or gross receipts) used in section 47(xiiib) are in line with the terms used in section 44AB. Therefore, any receipt or income which is taken as part of turnover for the purpose of tax audit u/s 44AB shall be taken into account for the aforesaid purpose. In my considered view, where the income is not forming part of total income u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder section 10 (exempted income) should not considered as part of total turnover of the business. Therefore, as long as dividend is exempt u/s 10(33) it would be be taken into account. Reply By Rajesh Tarpara: The Reply: sir i have a case : please reply My company is a Pvt.Ltd. company with accumulated surplus....now they want to split the company ( Demerger) into two companies : 1st co. wil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l continue with existing business and second will again be converted into LLP. so that thay can bye-pass dividend Distribution Tax in LLP.
is it possible and what are the tax implications?
[ note that original company has turnover more than 60/- lacs...can we convert resulting second company into LLP]
my email : [email protected] X X X X Extracts X X X X X X X X Extracts X X X X
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