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    Cost of Acquisition - IBREL - IIPL Demerger

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    Sharad Rankhamb
    The document summarizes a scheme of arrangement approved by the Delhi High Court for the demerger of Indiabulls Real Estate Limited's (IBREL) power and infrastructure business into a new company called Indiabulls Infrastructure and Power Limited (IIPL). It provides guidance to shareholders on calculating their cost of acquisition and date of acquisition of shares in IIPL according to income tax law, which is based on the proportion of IBREL's net assets and net worth transferred to IIPL. The date of acquisition of IIPL shares is deemed to be the date the IBREL shares were originally acquired.

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    Cost of Acquisition - IBREL - IIPL Demerger

    Uploaded by

    Sharad Rankhamb
    61 views2 pages
    The document summarizes a scheme of arrangement approved by the Delhi High Court for the demerger of Indiabulls Real Estate Limited's (IBREL) power and infrastructure business into a new company called Indiabulls Infrastructure and Power Limited (IIPL). It provides guidance to shareholders on calculating their cost of acquisition and date of acquisition of shares in IIPL according to income tax law, which is based on the proportion of IBREL's net assets and net worth transferred to IIPL. The date of acquisition of IIPL shares is deemed to be the date the IBREL shares were originally acquired.

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    The document summarizes a scheme of arrangement approved by the Delhi High Court for the demerger of Indiabulls Real Estate Limited's (IBREL) power and infrastructure business into a new company called Indiabulls Infrastructure and Power Limited (IIPL). It provides guidance to shareholders on calculating their cost of acquisition and date of acquisition of shares in IIPL according to income tax law, which is based on the proportion of IBREL's net assets and net worth transferred to IIPL. The date of acquisition of IIPL shares is deemed to be the date the IBREL shares were originally acquired.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    61 views2 pages

    Cost of Acquisition - IBREL - IIPL Demerger

    Uploaded by

    Sharad Rankhamb
    The document summarizes a scheme of arrangement approved by the Delhi High Court for the demerger of Indiabulls Real Estate Limited's (IBREL) power and infrastructure business into a new company called Indiabulls Infrastructure and Power Limited (IIPL). It provides guidance to shareholders on calculating their cost of acquisition and date of acquisition of shares in IIPL according to income tax law, which is based on the proportion of IBREL's net assets and net worth transferred to IIPL. The date of acquisition of IIPL shares is deemed to be the date the IBREL shares were originally acquired.

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    Indiabulls Real Estate Limited

    Registered Office: F-60, Malhotra Building, IInd Floor, Connaught Place, New Delhi-110001

    FOR THE ATTENTION OF COMPANY’S SHAREHOLDERS

    The Hon’ble High Court of Delhi has by its Order dated October 17, 2011 sanctioned the
    Scheme of Arrangement under Sections 391 to 394 of The Companies Act, 1956, inter alia for
    demerger of the following undertaking from Indiabulls Real Estate Limited (IBREL) to the
    Resulting Company:

    Undertaking Name of Resulting Company


    Power and Infrastructure Business Indiabulls Infrastructure and Power Limited
    (IIPL)

    In terms of the Scheme of Arrangement, the assets and liabilities relatable to the Demerged
    Undertaking have been transferred to the Resulting Company at values as appearing in the Books
    of Accounts of IBREL as on the appointed date i.e. opening hours of business on April 1, 2011.

    This information is for the shareholders about the method of calculation of the Cost of
    Acquisition and Date of Acquisition to the Resulting Company’s (IIPL’s) shares and Cost
    of Acquisition of IBREL’s shares as per the Provisions of the Income Tax Act, 1961 and is
    based on expert’s opinion.

    The cost of acquisition in respect of each shareholder will be different. The formula for
    ascertaining Cost of Acquisition in each case in IIPL as provided in Section 49(2C) of the
    Income Tax Act, 1961 will be as under:-
    Cost of acquisition of shares in Indiabulls Infrastructure and Power Limited (IIPL)=
    Cost of acquisition of shares in Indiabulls Real Estate Limited (IBREL) x Net book value of assets transferred to Indiabulls Infrastructure and Power Limited((IIPL)
    Net Worth of Indiabulls Real Estate Limited (IBREL)*

    * pre demerger

    The cost of acquisition of the shares of IBREL in the hands of the respective shareholders will be
    reduced by the cost of acquisition ascribable to the shares in IIPL.
    For the purpose of determining the post demerger Cost of Acquisition of Equity Shares of
    IBREL and Resulting Company (IIPL) under the Income Tax Act 1961, the Shareholders are
    advised to apportion their pre-demerger cost of acquisition of IBREL shares in the following
    manner:-

    Name of Company % of Cost of Acquisition of IBREL Shares

    Cost of acquisition in Indiabulls Real Estate Limited


    90.023%
    Cost of acquisition in Indiabulls Infrastructure and Power 9.977%
    Limited
    100.000%
    IBREL has been advised that as per Section 47(vid) of the Income Tax Act, 1961, the issue of
    shares by the resulting company, in a scheme of demerger to the Shareholders of the demerged
    company in consideration of demerger of the undertaking will not be regarded as transfer.
    Accordingly, Date of Acquisition of shares of the Resulting Company will be deemed to be the
    date when the equity shares of the demerged company (IBREL) were acquired.

    This communication is for the benefit of the shareholders and Indiabulls Real Estate
    Limited/Indiabulls Infrastructure and Power Limited takes no express or implied liability in
    providing this guidance.

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