https://www.taxtmi.com/caselaws?id=798675 Section 56(2)(viib) applies only when a closely held company receives consideration for issuing shares above their fair market value; it does not cover fully and compulsorily convertible debentures (FCCDs) before conversion. Rule 11UA does not deem FCCDs to be shares, and issuance of FCCDs and later conversion into equity are separate events. Until conversion, FCCDs retain independent contractual characteristics, including coupon returns. Their treatment as equity under regulatory or insolvency frameworks cannot expand the Income-tax Act's charging provision. Consideration received for FCCDs before conversion therefore falls outside section 56(2)(viib), and no valuation-based addition arises. en-us Mon, 31 Aug 2026 00:00:00 +0530 Thu, 10 Sep 2026 08:51:23 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=798675 Section 56(2)(viib) applies only when a closely held company receives consideration for issuing shares above their fair market value; it does not cover fully and compulsorily convertible debentures (FCCDs) before conversion. Rule 11UA does not deem FCCDs to be shares, and issuance of FCCDs and later conversion into equity are separate events. Until conversion, FCCDs retain independent contractual characteristics, including coupon returns. Their treatment as equity under regulatory or insolvency frameworks cannot expand the Income-tax Act's charging provision. Consideration received for FCCDs before conversion therefore falls outside section 56(2)(viib), and no valuation-based addition arises. Case-Laws Income Tax Mon, 31 Aug 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=798675