Clarification with respect to assessment of Startup Companies involving application of section 56(2) (viib) of the Income-tax Act, 1961

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..... the 7th of August, 2019 Subject: Clarification with respect to assessment of Startup Companies involving application of section 56(2) (viib) of the Income-tax Act, 1961.-reg. Instances have come to the notice of the Board that notices u/s 143(2) / 147 have been issued by the Assessing Officers in respect of Startup Companies, before the issue of notification of the Depart .....

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..... 2019 reiterating that the provisions of clause (viib) of sub-section (2) of section 56 of the said Act shall not apply to consideration received by a company for issue of shares that exceeds the face value of such shares, if the said consideration has been received from a person, being a resident, by a company which fulfils the conditions specified in para 4 of the notification dated 19.02. .....

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..... u/s 56(2)(viib), the issue of applicability of section 56 (2)(viib) will not be pursued during the assessment proceedings and inquiry or verification with regard to other issues in such cases shall be carried out by the Assessing Officer, only after obtaining approval of his/her supervisory officer. Due procedure as per I.T. Act shall be followed with regard to other issues for which the case h .....

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