Amendment of section 54B.
18. In section 54B of the Income-tax Act, in sub-section (1), for the words “the assessee or a parent of his”, the words “the assessee being an individual or his parent, or a Hindu undivided family” shall be substituted with effect from the 1st day of April, 2013.
Notes on Clauses:
Clause 18 of the Bill seeks to amend section 54B of the Income tax Act relating to capital gain on transfer of land used for agricultural purposes not to be charged in certain cases.
The existing provisions contained in sub-section (1) of the aforesaid section 54B provide that if an assessee transfers land which, in the two years immediately preceding the date on which the transfer took place, was being used by the assessee or a parent of his for agricultural purposes, giving rise to capital gain and purchases any other land for being used for agricultural purposes, within two years after the date of such transfer, the capital gain is exempt to the extent such gain has been utilised for the aforesaid purpose.
It is proposed to amend the aforesaid sub-section so as to extend the benefit of exemption to the assessee being a Hindu undivided family.
This amendment will take effect from 1st April, 2013 and will, accordingly, apply in relation to the assessment year 2013-2014 and subsequent assessment years.
