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INTRODUCTION
• CAPITAL GAINS
“Any profit or gains arising from the
transfer of capital assets is taxable under
the head capital gains in the previous year
in which the transfer has taken place.”
• Conditions
• There should be a capital asset.
• The capital asset should be transferred by the
assessee.
• Such transfer should take place during the
previous year.
• The profits or gains should arise as a result of
this transfer.
• Such profit or gain should not be exempted
from tax under sections 54, 54B, 54D, 54EC,
54F and 54G & 54GA.
DEFINITION OF CAPITAL
ASSETS
• Indexed Cost
• =Cost of Improvement X CI Index in Yr of Transfer
• CI Index in Yr of Improvement
INTRODUCTION OF A
CAPITAL ASSET AS CAPITAL
CONTRIBUTION
Section 45(3)
Taxable in the hands of the partner
Consideration: Amount recorded in
the books of accounts
DISTRIBUTION OF CAPITAL
ASSETS ON A FIRMS DISSOLUTION
Section 45(4)
Chargeable in the hands of the firm
Consideration : fair market value as
on the date of transfer
SLUMP SALE
SEC 50B
Slump sale means transfer of one or
more undertakings as a result of sale
for lump sum consideration without
values being assigned to individual
assets and liabilities in such sales –
Section 2(42C).
SLUMP SALE