As we know that GAAR in short term will make FIIS and investors run away from our country in shorter time frame. However start-up entrepreneur have a reason to cheer as Finance Minister has been magnanimous in Finance bill for budding ventures looking for angel money for their funding. The gist is as appended below:
It has been proposed in the Finance Bill that any consideration received by a closely held company in excess of the fair market value of its shares would be taxable. Considering the concerns raised by ‘angel’ investors who invest in start-up companies, I propose to provide an enabling provision in the Income Tax Act for exemption to a notified class of investors.
However before jumping the gun do again check the ramifications as these financial documents are always left with a fine print to take advantage at a later stage.
