Notification under section 56(2)(viib) of the income tax act
Notification under section 56(2)(viib) of the income tax act
S.O. 2274(E).—In exercise of the powers conferred by sub-clause (ii) of the first proviso to clause (viib) of sub-section (2) of Section 56, the Central Government hereby notifies the following class or classes of persons, for the purposes of the said clause, namely:-
(i) Government and Government related investors such as central banks, sovereign wealth funds, international or multilateral organizations or agencies including entities controlled by the Government or where direct or indirect ownership of the Government is seventy-five percent or more;
(ii) Banks or Entities involved in Insurance Business where such entity is subject to applicable regulations in the country where it is established or incorporated or is a resident;
(iii) Any of the following entities, which is a resident of any country or specified territory listed in Annexure, and such entity is subject to applicable regulations in the country where it is established or incorporated or is a resident :––
(a) entities registered with Securities and Exchange Board of India as Category-I Foreign Portfolio Investors;
(b) endowment funds associated with a university, hospitals or charities;
(c) pension funds created or established under the law of the foreign country or specified territory;
(d) Broad Based Pooled Investment Vehicle or fund where the number of investors in such vehicle or fund is more than fifty and such fund is not a hedge fund or a fund which employs diverse or complex trading strategies.
ANNEXURE
List of Countries
Sl. No. Name of Country/ Specified Territory
1 Australia
2 Austria
3 Belgium
4 Canada
5 Czech Republic
6 Denmark
7 Finland
8 France
9 Germany
10 Iceland
11 Israel
12 Italy
13 Japan
14 Korea
15 New Zealand
16 Norway
17 Russia
18 Spain
19 Sweden
20 United Kingdom
21 United States
S.O. 2275(E).—In exercise of the powers conferred by clause (ii) of the first proviso to clause (viib) of sub-section (2) of section 56 of the Income-tax Act, 1961 (43 of 1961) and in supersession of the notification of Government of India in the Ministry of Finance, Department of Revenue, Central Board of Direct Taxes published in the Gazette of India, Extraordinary, Part-II, Section 3, Sub-section (ii) vide number S.O. 1131(E) dated 5th March 2019, except as respect things done or omitted to be done before such supersession, the Central Government, hereby notifies 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 any person, by a company which fulfills the conditions specified in para 4 of the notification number G.S.R. 127(E), dated the 19th February, 2019 issued by the Ministry of Commerce and Industry in the Department for Promotion of Industry and Internal Trade and published in the Gazette of India, Extraordinary,Part-II, section 3, Sub-Section (i) on 19th February, 2019 and files the declaration referred to in para 5 of the said notification of the Department for Promotion of Industry and Internal Trade.
- This notification shall be deemed to have come into force from the 1st day of April 2023.
Explanatory memorandum
It is certified that no person is being adversely affected by giving retrospective effect to this notification.
Read More on Income-tax, CBDT
