TMI BlogInsertion of new section 54GB.X X X X Extracts X X X X X X X X Extracts X X X X ..... of section 139, utilises the net consideration for subscription in the equity shares of an eligible company (herein referred to as the company); and (iii) the company has, within one year from the date of subscription in equity shares by the assessee, utilised this amount for purchase of new asset, then, instead of the capital gain being charged to income-tax as the income of the previous year in which the transfer takes place, it shall be dealt with in accordance with the following provisions of this section, that is to say, (a) if the amount of the net consideration is greater than the cost of the new asset, then, so much of the capital gain as it bears to the whole of the capital gain the same prop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h (a) the amount of capital gain arising from the transfer of the residential property not charged under section 45 on the basis of the cost of the new asset as provided in sub-section (1), exceeds (b) the amount that would not have been so charged had the amount actually utilised for the purchase of the new asset within the period specified in sub-section (1) been the cost of the new asset, shall be charged under section 45 as income of the assessee for the previous year in which the period of one year from the date of the subscription in equity shares by the assessee expires; and (ii) the company shall be entitled to withdraw such amount in accordance with the scheme. (4) If the equity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee has more than fifty per cent. share capital or more than fifty per cent. voting rights after the subscription in shares by the assessee; and (iv) it is a company which qualifies to be a small or medium enterprise under the Micro, Small and Medium Enterprises Act, 2006; (27 of 2006.) (c) net consideration shall have the meaning assigned to it in the Explanation to section 54F; (d) new asset means new plant and machinery but does not include (i) any machinery or plant which, before its installation by the assessee, was used either within or outside India by any other person; (ii) any machinery or plant installed in any office premises or any residential a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... say, if the amount of the net consideration is greater than the cost of the new asset, then, so much of the capital gain as it bears to the whole of the capital gain the same proportion as the cost of the new asset bears to the net consideration, shall not be charged under section 45 as the income of the previous year or if the amount of the net consideration is equal to or less than the cost of the new asset, the capital gain shall not be charged under section 45 as the income of the previous year. It is further proposed to provide that the amount of the net consideration, which has been received by the company for issue of share to the assessee, to the extent it is not utilised by the company for the purchase of the new asset before t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titled to withdraw such amount in accordance with the scheme. It is also proposed to provide that if the equity shares of the company or the new asset acquired by the company are sold or otherwise transferred within a period of five years from the date of their acquisition, the amount of capital gain arising from the transfer of the residential property not charged under section 45 as provided in sub-section (1) shall be deemed to be the income of the assesse chargeable under the head capital gains of the previous year in which such equity shares or such new asset are sold or otherwise transferred, in addition to taxability of gains, arising on account of transfer of shares or of the new asset, in the hands of the assesse or the compan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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