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2016 (2) TMI 799 - HC - Income TaxCapital gain under Section 45(4) - transfer - whether the Tribunal was right in law in holding that there is a dissolution of the firm and not conversion of a firm into a company for the purpose of capital gains under Section 45(4) ? - Held that:- In the case on hand, the partners have taken equity shares in the private limited company that was inducted as the fifth partner. Therefore, whatever rights that they had in the capital assets of the firm by way of being its partners, continue to exist in the form of equity shares that they held in the private limited company. In other words, one form of ownership that they had as partners of the partnership firm, got converted into another form. Hence, this is not a case where there was either a transfer of a capital asset or the distribution of a capital asset. This aspect has been completely lost sight of by all the Authorities. - Decided in favour of assessee
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