E. Capital gains
Capital gains
44. (1) The income from the transfer of any investment asset shall be computed under the head "Capital gains".
(2) The income under the head "Capital gains" shall, without prejudice to the generality of the foregoing provisions, include the following,-
(a) income from the transfer referred to in clause (c) or clause (d) of sub-section (1) of section 45, if,-
(i) the parent company, or its nominee, ceases to hold the whole of the share capital of the subsidiary company; or
(ii) the investment asset is converted by the transferee into, or treated by it as, its business trading asset;
(b) the income from the transfer referred to in clause (e) of section 45, if any of the conditions laid down in clause (16) or clause (81), as the case may be, of section 284 is not complied with;
(c) the amount of withdrawal referred to in sub-section (4) of section 53 to the extent determined in accordance with the formula -
|
A X B / C |
|
Where |
A |
= |
amount of deduction claimed under section 53; |
|
|
B |
= |
the amount withdrawn from the account under the capital gains deposit scheme, which is not utilised for the purposes of purchase or construction of the new investment asset within one month from the end of the month in which the amount is withdrawn; |
|
|
C |
= |
the net consideration as a result of the transfer of original investment asset; and |
(d) the amount of deposit referred to in sub-section (5) of section 53 to the extent determined in accordance with the formula-
|
A X B / C |
|
Where |
A |
= |
= amount of deduction claimed under section 53; |
|
|
B |
= |
the balance in the account referred to in sub-section (5) of section 53, of the assessee, as on the first day of the financial year immediately following the three financial years from the end of the financial year in which the transfer of the original investment asset referred to in that section is effected; |
|
|
C |
= |
the net consideration as a result of the transfer of original investment asset. |
