Income from certain transfers not to be treated as capital gains
45. The income from the following transactions shall not be included in the computation of income under the head "Capital gains":-
(a) distribution of any investment asset on the total or partial partition of a Hindu undivided family;
(b) gift, or transfer under an irrevocable trust, of any investment asset, other than sweat equity share;
(c) transfer of any investment asset by a company to its subsidiary company, if—
(i) the parent company or its nominees hold the whole of the share capital of the subsidiary company,
(ii) the subsidiary company is an Indian company; and
(iii) the subsidiary company treats the asset as an investment asset;
(d) transfer of any investment asset by a subsidiary company to the holding company, if
(i) the whole of the share capital of the subsidiary company is held by the holding company or its nominees,
(ii) the holding company is an Indian company, and
(iii) the holding company treats the asset as an investment asset;
(e) transfer of any investment asset by a predecessor to a successor in a scheme under a business reorganisation if the successor is neither a non-resident nor a foreign company;
(f) transfer of any investment asset situated in India, by an amalgamating or demerged foreign company to the amalgamated or resulting foreign company, if -
(i) the transfer is effected under a scheme of amalgamation or demerger, as the case may be; and
(ii) the transfer does not attract tax on capital gains in the country, in which the amalgamating or demerged company is incorporated;
(g) transfer of shares of a predecessor by a shareholder under a scheme of business reorganisation, if-
(i) the transfer is made in consideration of the allotment to the shareholder of shares in the successor amalgamated company; and
(ii) the successor is neither a non-resident nor a foreign company;
(h) transfer of bonds or global depository receipts by a non-resident to another non-resident, if the transfer is made outside India;
(i) transfer of any work of art, archaeological, scientific or art collection, book, manuscript, drawing, painting, photograph or print, to the Government or a University or the National Museum, National Art Gallery, National Archives or any other public museum or institution of national importance or of renown throughout any State or States and notified by the Central Government in the Official Gazette for this purpose;
(j) transfer by way of conversion of any bonds or debentures, debenture-stock or deposit certificates in any form, of a company into shares or debentures of that company;
(k) transfer by way of convernsion of foreign exchange convertible bond of a company into shares or debenture of any company;
(l) transfer of any securities, if-
(i) the transfer is effected under a scheme for lending of any securities; and
(ii) the scheme is framed in accordance with the guidelines issued by the Securities and Exchange Board of India, or the Reserve Bank of India.
(m) transfer of any investment asset, if -
(i) the transferor is a company; and
(ii) the asset of the company is distributed to its shareholders on its liquidation;
(n) transfer of a investment asset under a will;
