Amendment to definition of Specified Mutual Fund under section 50AA (Rationalisation and Simplification of taxation of Capital Gains)

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..... taxation for Market Linked Debentures and Specified Mutual Funds by way of introduction of section 50AA of the Act. The gains in such cases were to be taxed as Short-term Capital Gain irrespective of period of holding. The requirement of investment of not more than 35% in equity shares has also impacted other funds which are not debt-oriented funds, but invest below 35% in equity shares. Such fun .....

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..... ii) of Explanation of section 50AA to provide that a specified mutual fund shall mean a mutual fund: (a) a Mutual Fund by whatever name called, which invests more than sixty five per cent of its total proceeds in debt and money market instruments; or (b) a fund which invests sixty five per cent or more of its total proceeds in units of a fund referred to in sub-clause (a). The above amendment .....

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