CBDT: Issues draft notification u/s. 115JG (1) relating conversion of foreign banks’ Indian branch into

CBDT issues draft notification u/s. 115JG(1) specifying the conditions to be fulfilled upon conversion of Indian Branch of foreign bank into Indian subsidiary company  and also specifying modifications, exceptions, in applicability of certain provisions of the Act to such conversion;  Draft notification proposes following conditions, viz. (a) all the assets and liabilities of the Indian branch immediately before conversion become the assets and liabilities of the Indian subsidiary Company, (b) the foreign company (engaged in banking business in India through branch)  or its nominees hold the whole of the share capital of the subsidiary company and (c) the foreign company does not receive any consideration or benefit, other than by way of allotment of shares in the Indian subsidiary company;  With respect to unabsorbed depreciation, draft notification proposes that the aggregate depreciation deduction allowable to the Indian branch and the Indian subsidiary company shall not exceed the deduction calculated at the prescribed rates as if the conversion had not taken place, and such deduction to  be apportioned between the Indian branch and the Indian subsidiary company in the ratio of the number of days for which the assets were used by them; Further, it proposes that the tax credit of the Indian branch shall be deemed to be the tax credit of the Indian subsidiary company for the purpose of the previous year in which conversion was effected and the provisions of Sec. 115JAA shall apply accordingly; Invites stakeholders comments/suggestions on the draft notification by November 30th