Reduction in Share Capital of Subsidiary Amounts to Asset Transfer u/s 2(47), Income Tax Act: Supreme Court

The Supreme Court ruled that the reduction in share capital of a subsidiary constitutes an asset transfer under Section 247 of the Income Tax Act. The case involved a dispute over whether the reduction in capital by a subsidiary should be treated as a transfer of assets for tax purposes. The Court concluded that the reduction in capital triggers the provisions of the Income Tax Act, leading to tax implications for the involved parties. This judgment clarifies the tax treatment of share capital reductions in subsidiary companies and sets a precedent for similar cases in the future.