Section 11 of The Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970
For the purposes of the Income-tax Act, 1961 (43 of 1961), every corresponding new bank shall be deemed to be an Indian company and a company in which the public are substantially interested.
Summary
- For tax purposes, every corresponding new bank established under this Act is legally treated as an Indian company.
- This classification is specifically used for the purposes of the Income-tax Act, 1961.
- Each of these banks is also deemed, meaning legally considered, to be a company in which the public are substantially interested.
Practical examples
FAQ
1. Which tax law treats these banks as Indian companies?
The Income-tax Act, 1961 is the law that treats these banks as Indian companies.
2. What does "public are substantially interested" mean under Section 11?
It is a legal term under tax law meaning that the company is widely held by the public rather than being closely owned by a few individuals, which affects how it is taxed.
Test yourself
Q1.Under Section 11 of The Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, for the purposes of which law is a corresponding new bank deemed to be an Indian company?
Q2.Under Section 11 of The Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, how are these banks classified regarding public interest for tax purposes?
Q3.Under Section 11 of The Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, which of the following describes the legal status of the corresponding new banks?
Q4.Under Section 11 of The Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, if a tax dispute arises, can the tax authority argue that the bank is a closely-held private company?