Capital gains exemption for amalgamation of foreign company shares applies when shareholder continuity and foreign tax conditions are met. A transfer of a capital asset, being a share of a foreign company that derives substantially its value from shares of an Indian company, is not regarded as a transfer in a scheme of amalgamation if at least 25% of the shareholders of the amalgamating foreign company continue as shareholders of the amalgamated foreign company and the transfer does not attract capital gains tax in the country of incorporation. In such cases, the transferee takes the cost of the previous owner and the previous owner's period of holding is also considered.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Capital gains exemption for amalgamation of foreign company shares applies when shareholder continuity and foreign tax conditions are met.
A transfer of a capital asset, being a share of a foreign company that derives substantially its value from shares of an Indian company, is not regarded as a transfer in a scheme of amalgamation if at least 25% of the shareholders of the amalgamating foreign company continue as shareholders of the amalgamated foreign company and the transfer does not attract capital gains tax in the country of incorporation. In such cases, the transferee takes the cost of the previous owner and the previous owner's period of holding is also considered.
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