63
(E) STATEMENT ON TAX BENEFITS
To
Rodium Realty Limited
501, X’ cube,
Plot No. 636,
Off New Link Road, Andheri (W),
Mumbai- 400053
Sub: Rights Issue of Your Company
Dear Sirs,
We hereby report that the enclosed statement states the possible direct tax benefits available to Rodium Realty
Limited (‘the company’)
and to the shareholders of the company under the Income-tax Act, 1961 and Wealth
Tax Act, 1957. Several of these benefits are dependent on the Company or the shareholders fulfilling the
conditions prescribed under the relevant provisions of the statute. Hence, the ability of the Company and
shareholders to derive the tax benefits is dependent upon fulfilling such conditions, which is based on business
imperatives the Company may face in the future and accordingly, the Company may or may not choose to
fulfill.
The benefits discussed in the enclosed statement are not exhaustive. This statement is only intended to provide
general information to the investors and is neither designed nor intended to be a substitute for professional tax
advice. In view of the individual nature of the tax consequences and the changing tax laws, each investor is
advised to consult his or her own tax consultant with respect to the specific tax implications arising out of their
participation in the issue.
We do not express any opinion or provide any assurance as to whether:
i.
the Company or its shareholders will continue to obtain these benefits in future; or
ii.
the conditions prescribed for availing the benefits have been / would be met with.
The contents of the enclosed statement are based on information, explanations and representations obtained
from the Company and on the basis of our understanding of the business activities and operations of the
Company.
Our views expressed herein are based on the facts and assumptions indicated to us. No assurance is given that
the revenue authorities/courts will concur with the views expressed herein. Our views are based on the existing
provisions of law and its interpretation, which are subject to change from time to time. We do not assume
responsibility to update the views consequent to such changes. The views are exclusively for the use of the
company. We shall not be liable to the company for any claims, liabilities or expenses relating to this
assignment except to the extent of fees relating to this assignment, as finally judicially determined to have
resulted primarily from bad faith or intentional misconduct. We will not be liable to any other person in respect
of this statement.
For M. M. NISSIM AND CO.
Chartered Accountants
(ICAI Reg. No.107122W)
(N. Kashinath)
Partner
Mem. No.36490
Date: August 11, 2011
Place: Mumbai
64
TAX BENEFITS
STATEMENT OF POSSIBLE DIRECT TAX BENEFITS AVAILABLE TO RODIUM REALTY
LIMITED AND ITS SHAREHOLDERS
A.
Benefits to the Company under the Income-Tax Act, 1961 (the “Income Tax Act”):
General Tax Benefits
1.
Under section 10(34) of the Income Tax Act, any income by way of dividends referred to in section 115-O
(i.e. dividends declared, distributed or paid on or after 1 April 2003 by domestic companies) received on the
shares of any company is exempt from tax.
2.
Under section 10(35) of the Income Tax Act, any income received from units of a Mutual Fund specified
under section 10(23D) of the Income Tax Act, is exempt from tax.
3.
Under section 10(38) of the Income Tax Act, any long-term capital gains arising to a shareholder from
transfer of long-term capital asset, being equity shares in a company or a unit of an equity oriented fund (i.e.
if the shares or units are held for more than twelve months) would not be liable to tax in the hands of the
shareholder, if the following conditions are satisfied:
a.
The transaction of sale of such equity share or unit is entered into on or after October 1, 2004;
b.
The transaction is chargeable to securities transaction tax.
However, the expenditure and income relating to the provisions of section 10(38) of the Income Tax Act
would not be adjusted for the purpose of computing book profits under section 115JB of the Income Tax
Act.
4.
Section 14A of the Income Tax Act restricts claim for deduction of expenses incurred in relation to income
which does not form part of the total income under the Income Tax Act viz income received under sections
10(34), 10(35), etc. Thus, any expenditure incurred to earn the said income is not a tax-deductible
expenditure.
5.
Under Section 32 of the Income Tax Act, the Company can claim depreciation allowance at the prescribed
rates on tangible assets such as building, plant and machinery, furniture and fixtures, etc. and intangible
assets such as patent, trademark, copyright, know-how, licenses, etc. if acquired after 31 March 1998. In
terms of Clause (iia) of subsection (1) of section 32 of the Income Tax Act, the Company is entitled to
further depreciation of 20% as additional depreciation on new plants and machinery acquired and installed
after 31 March 2005, subject to conditions specified therein.
6.
As per the provisions of section 32(2) of the Income Tax Act, where full allowance cannot be given to the
depreciation allowance in any year, the same can be carried forward and claimed in the subsequent years.
Further, as per the provisions of section 72 of the Income Tax Act, unabsorbed business losses which are
not set off in any previous year can be carried forward and set off against the business profits of the
subsequent assessment years, subject to a maximum of eight assessment years. However, the carry forward
and set off of business losses is subject to provisions of section 79 of the Income Tax Act dealing with carry
forward and set off of losses in case of companies in which a change in shareholding has taken place and
section 80 of the Income Tax Act dealing with submission of returns for losses.
7.
Under section 35D of the Income Tax Act, the Company will be entitled to a deduction equal to one-fifth of
the expenditure incurred of the nature specified in the said section, including expenditure incurred on
present issue, such as under writing commission, brokerage and other charges, as specified in the provision,
for a period of five successive years subject to the limits provided and conditions specified therein.
Dostları ilə paylaş: |