S. 54EC– Reckoning period of six months from the date of transfer

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Revenue contending that sale took place on 24.02.05 and thereby the investment made u/s. 54EC on 30.08.2005 is beyond the prescribed period of six month. Once the board of directors approve the transfer, then only the process of transfer of shares can be said to be completed in case of a private limited company. The Annual Return filed before the ROC disclosed that the date of registration of transfer was 28th February 2005, confirmed by purchaser. Board resolution approving transfer of shares was passed on 25th February 2005. Just because stamping was done on 24th February 2005 of blank forms, it cannot be concluded that there is transfer on 24th February 2005. Thus, investment made on 30th August 2005, was within a period of six months as contemplated under the Act. Further, we are of the opinion that six months period should be reckoned from the end of the month in which the transfer takes place