India: Sales proceeds in escrow account not includable in capital gains (tribunal decision)
To the extent proceeds are ultimately actually received by the taxpayer, they would be subject to tax.
Not includable in capital gains (tribunal decision)
The Delhi bench of the Tribunal held that proceeds from a sale of shares in a company that were kept in an escrow account for meeting future liabilities of the company and were unlikely to be received by the taxpayer were not includable in the capital gains realized by the taxpayer on the sale. However, to the extent such proceeds are ultimately actually received by the taxpayer, they would be subject to tax.
The case is: Modi Rubber Ltd. v. DCIT
Read a February 2024 report [PDF 299 KB] prepared by the KPMG member firm in India
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