Transfer of Director Property

[Vighneshwar Bhat]

Dear all,

One of Director of Company wish to give his own property to Company (not a sale), against which he wish to get Equity shares.

Doubt is:

Is it stamp duty Attracts for this transaction? Company located at Bangalore.

Thanks in advance.

Vighnesh Bhat

[trupti chavan]

Yes the transaction will attract Transfer of Property Act and Stamp duty too.

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Thanks and Regards,

 

TRUPTI CHAVAN

9833043310

[priya stalin]

It is like sale only because there is a quid pro quo involved by which for property equity shares are subscribed.


Regards
Priya Advocate
S & P Law Associates

S. PRIYA STALIN
Advocate

[Vighneshwar Bhat]

Thanks for both of your reply.

Can you please quote the section/exact provision of the applicable act.

Thanks in advance.

Vighnesh
Company Secretary

[priya stalin]

Section 54 of Transfer of Property Act


Regards
priya

[rama murthy]

To my knowledge sale includes barter as well. He may have to pay capital gains tax as well - short term / long term depending upon the period for which he was the owner

Ram

[priya stalin]

Issue is whether the company director giving own property to the company attracts stamp duty or not?
The answer is that the director for his blood relation can settle the property for other aspects if he settles or make gift also it will be classified as sale and stamp duty and reg fees are attracted. You cannot word it as a gift because in return equity shares are allotted.

Moreover the amount in hand will be taxed but when shares are purchased capital gain tax will not be attracted as of now. But only when those shares are encashed as you said capital gain tax will be levied.


Regards
Priya
Advocate

[rama murthy]

To my knowledge, exchange of shares for giving away property will amount to transfer under the tax laws and the gains arising out of transfer of property will attract capital gains tax - short / long term depending upon the period of holding the property. The tax on long term capital gains can be avoided if the gains are invested as stipulated in the tax laws.  

Ram

[HEGDE KAMALAKAR]

Whenever there is relinquishment of right in a property in exchange of other consideration, capital gain is taxable under the I-T Act 1961.

[renukameera91]

Dear Sir,

This transaction will attract  the stamp duty. I have come across same dealing very recently. 

With Best,

C.Renuka

On Wed, Feb 1, 2012 at 2:55 PM, Vighneshwar Bhat <vighne...@gmail.com> wrote:

[renukameera91]

Sec. 3,5,6 of Transfer Of Property Act,1882

With Best,

C.Renuka

[Vighneshwar Bhat]

Thanks for all the reply.

Can any one further en-light on applicable stamp rate for this.

Further Director will enter into agreement with company for providing the asset to company and against that company will allot the shares.

Is this transaction is in compliance with section 75? Can agreement will be a consideration for share allotment?

Please do the needful.

[ramela rangasamy]

Hi Vighneshwar Bhat,

Section 75 will apply. Refer 75(1)(b), if agreement executed. File Form no.2 along with that agreement.

Refer 75(2), if agreement not executed, file Form no.3 along with the particulars of contract stamped with the stamp duty, as though the contract is written.

R.Ramela

Company Secretary in Practice

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From: Vighneshwar Bhat <vighne...@gmail.com>
To: csmy...@googlegroups.com
Sent: Friday, 3 February 2012 3:37 PM
Subject: Re: [CSMysore] Transfer of Director Property

[renukameera91]

Dear Friend,

This stamp duty comes under state matter and depends on the state you belongs.

With Best,

C.Renuka

[priya stalin]

This is Sale Agreement and it is to be entered in the stamp duty of Rs.20/-

When you come for sale deed you have to first inform us the location of the property.

In case you need any clarification contact us

Thanks & Regards
S.Priya

Advocate
S & P Law Associates

9840729285

[Varsha]

Dear All,

Director(me) intereted to sale my property to company against shares.

Please inform me about capital gain for both Company and Director, transaction on share basis only.

regards
varsha

[Varsha]

[Varsha]

Dear All,

Director(me) intereted to sale my property to company against shares.

Please inform me about capital gain for both Company and Director, transaction on share basis only.

regards
varsha

 


On Tuesday, February 7, 2012 at 3:30:08 PM UTC+5:30, Priya Stalin wrote:

[Asha Thesiya]

Renuka Ma'am,

In our case Director selling his residential flat to Private Limited Company.

In this case can you pls provide the procedure to be followed as per Companies Act.

Thank You,

Asha

[Sankesh Rajgor]

If it's on market price (i.e. Arms length price) nothing additionally required.

Other views solicited. 

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[Asha Thesiya]

Okay Thank You.

I think I need to file MGT-14 for Related Party Transaction. 

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Thanks & Regards,
Asha Thesiya

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