mRnDHFinR

a eaa/69,9/o/aead
CIN : L17120MH1984PLCO33553
Registered Office: Plot No. C-3, M.I.D.C., Tarapur Industrial Area, Boisar- 401 506

9th November, 2016

To,
BSE Limited
Phiroze Jeejeebhoy Towers,
Dalai Street,
Mumbai - 400 023

To,
National Stock Exchange of India Limited
Exchange Plaza, 5th Floor, Plot No. C-1,
G Block, Bandra Kurla Complex,
Bandra (E), Mumbai 400 051

Sub: Note on cost of acquisition of the equity shares of The Mandhana Retail Ventures
Limited ("Resulting Company/ MRVL") vis-a-vis cost of acquisition of the
equity shares of Mandhana Industries Limited ("Demerged Company/ MIL") for
computing the capital gain/loss as per the provisions of Income Tax Act, 1961
Ref: BSE Scrip Code -533204 & NSE Symbol - MANDHANA
Dear Sir,
With regard to captioned subject, please find enclosed herewith a detailed note on cost
of acquisition of the equity shares of MRVL vis-a-vis cost of acquisition of the equity
shares of MIL for computing the capital gain/loss as per the provisions of Income Tax
Act, 1961 (the 'Act') arising upon sale of equity shares.
This is for your records and wide dissemination to the public at large. The same shall
also be available at the website of the company at www.mandhana.com .
Yours faithfully,
For MANDHANA INDUSTRIES LIMITED

MA rg DH A nA
PURUSHOTTAIVI C. MANDHANA
(Chairman and Managing Director)

Its1DusRT IEs LTD

End: As above.

MFIrlDHAM WIDUSTRIES LTD.

i-Mg\
taitea.

"Aston.

207-214, Peninsula Center, Dr. S.S. Rao Road, Off. Dr. Ambedkar Road, Parel, Mumbai - 400 012. India
Tel. : 91-22-43539191 Fax : 91-22-43539216 / 17 / 18 E-mail : info@mandhana.com Website : www.mandhana.com

mRnoHRnR
a tali,itaidoltd,axii
CIN : L17120MH1984PLCO33553
Registered Office: Plot No. C-3, M.I.D.C., Tarapur Industrial Area, Boisar- 401 506

FOR THE ATTENTION OF THE COMPANY'S SHAREHOLDERS

The Hon'ble high Court of Judicature at Bombay has vide its Order dated March 29, 2016 sanctioned the
Scheme of Arrangement ("Scheme") between Mandhana Industries Limited ("MIL" / "Demerged
Company") and The Mandhana Retail Ventures Limited (erstwhile Mandhana Retail Ventures Limited)
("MRVL" / "Resulting Company"), and their respective shareholders and creditors under Sections 391 to
394 read with and Sections 100 to 103 of the Companies Act, 1956.
The Scheme, inter-alia provided for the transfer/vesting by way of demerger of the 'Retail Business' of
MIL on a going concern basis to MRVL with effect from April 1, 2014 (Appointed Date) and issue of
equity shares of MRVL to the equity shareholders of MIL in terms of the said scheme.
MIL had fixed September 23, 2016 as the 'Record Date' to determine eligibility of its shareholders, who
would be entitled to receive shares of _MRVL, pursuant to the Scheme. In terms of the Scheme, MRVL has
issued and allotted, to each member of MIL, whose name was appearing in the Register of Members as on
the Record Date, 2 (two) fully paid up equity shares of face value Rs.10 each of MRVL for every 3 (three)
fully paid up equity shares of face value of Rs.10 each held by such member in MIL. MRVL, post allotment
has applied for listing of the shares in BSE Limited and National Stock Exchange of India Limited.
This communication is sent for the general guidance of the shareholders of MIL for computing
proportionate cost of acquisition of the equity shares of MRVL vis-a-vis Cost of acquisition of the equity
shares of MIL for computing the capital gain/loss as per the provisions of Income Tax Act, 1961 (the 'Act')
arising upon sale of equity shares.
Section 49 (2C) of the Act provides that the cost of acquisition of the shares of resulting company i.e.
MRVL, shall be the amount which bears to the cost of acquisition of shares held by the assesse in the
Demerged Company, the same proportion as the net book value of the assets of Demerged Undertaking
(Retail Business) to the Net Worth of the Demerged Company (MIL) immediately before the demerger.
Accordingly the cost of acquisition of the equity shares of the Demerged Company (MIL) shall be the
original cost of acquisition as reduced by the cost of acquisition as ascertained for the shares of MRVL
under Section 49 (2D) of the Act.
In terms of the Scheme, On April 1, 2014 being the appointed date, the Assets and Liabilities of the
Demerged Undertaking of MIL have been transferred to MRVL at the value appearing in the books of MIL
as at March 31, 2014. The book value of Net Assets transferred by MIL to MRVL was Rs.2,208.26 Lakh
of the Total Net Assets of MIL Rs.52,349.83 Lakh.

MI

DHAnA
LTD
s RTIEs

Page 1 of 2

MRf1DHR111F1 II1DUSTRIES LTD.

reseeplorkm,Isubstonces

207-214, Peninsula Center, Dr. S.S. Rao Road, Off. Dr. Ambedkar Road, Parel, Mumbai - 400 012. India
Tel. : 91-22-43539191 Fax : 91-22-43539216 / 17 / 18 E-mail : info@mandhana.com Website : www.mandhana.com

Continuation Sheet

MFIIIDHR1114
fakiV/ed otta4/

Shareholders are advised to apportion their pre-demerger/ original cost of acquisition of equity shares of
MIL in the following manner:
Name of the Company
Mandhana Industries Limited
Retail Ventures
The Mandhana
Limited
TOTAL

% of Original Cost of
Acquisition of MIL
95.78%
4.22%
100%

In terms of Section 47 (vid) of the Act, the issue of equity shares of the resulting company (MRVL) to the
shareholders of demerged company (MIL) pursuant to the scheme is not a transfer and hence not taxable in
the hands of the shareholder. Further in respect of the equity shares issued by MRVL, the date of acquisition
of such equity shares, for the purpose of computation of capital gain/loss in the hands of the shareholder,
as and when the shares are sold, will be the date of acquisition of the original shares of MIL for each
shareholder, as per Clause (g) in explanation 1 to section 2 (42A) of the Income Tax Act, 1961.
Please note that this communication is merely for the general guidance of the shareholders, and should not
be considered as a substitute for any independent opinion that the shareholders may obtain. The concerned
regulatory authority, statutory or judicial authority, including any assessing officer/ appropriate appellate
authority, could take a different view. The company takes no express or implied liability in relation to this
guidance.
Further note that if there is any change, including change having a retrospective effect in the statutory laws
and regulations, the comments expressed in this communication would necessarily would have to reevaluated in the light of changes the company could not take the responsibility of updating this
communication at any time in future.

Thanking You.
Yours Faithfully,
For MANDHANA INDUSTRIES LIMITED

MAnDHAT1A
INDUSRTIES LTD
fl

PURUSHOTTAM C. MANDHANA

fre'

'

Jed 4

pe

(Chairman & Managing Director)

Mumbal, 9th November, 2016
Page 2 of 2