What is section 47 of Income Tax Act?

Section 47 of Income tax act covers certain transactions, which are not regarded as “transfer” and, accordingly gains arising from such transaction, are not liable to capital gain tax. The rational for such and exemption is that these transactions do not result into any taxable income in the hands of the Transferor.

What transactions are not regarded as transfer U S 47?

Section 47 specifies certain transactions which will not be regarded as transfer for the purpose of capital gains tax: Any distribution of capital assets on the total or partial partition of a HUF [Section 47(i)].

What is Section 2 47 of Income Tax Act?

Section 2(47) in The Income- Tax Act, 1995. (47) 5 transfer”, in relation to a capital asset, includes,- (i) the sale, exchange or relinquishment of the asset; or. (ii) the extinguishment of any rights therein; or. (iii) the compulsory acquisition thereof under any law; or.

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Which are not treated as transfer under Income Tax Act?

(viib) any transfer of a capital asset, being a Government Security carrying a periodic payment of interest, made outside India through an intermediary dealing in settlement of securities, by a non-resident to another non-resident.

What is not transfer in income tax?

Transactions Not regarded as ‘Transfer’ for Computing Capital Gain [Section 46 and 47] … Transfer of a capital asset by a non-resident of foreign currency convertible bonds or Global Depository Receipts to another non-resident if the transfer is made outside India and if a few conditions are satisfied.

What Cannot be regarded as capital asset?

Any stock in trade, consumable stores, or raw materials held for the purpose of business or profession have been excluded from the definition of capital assets. Any movable property (excluding jewellery made out of gold, silver, precious stones, and drawing, paintings, sculptures, archeological collections, etc.)

What is section 45 of Income Tax Act?

Section 45(1) of the Income tax Act. 1961 provides than any profit and gains arising from the transfer of a capital assets effected in previous year shall be chargeable to tax under the head of capital gain and shall be deemed to be the income of the previous year in which the transfer took place.

How is capital gain computed?

In case of short-term capital gain, capital gain = final sale price – (the cost of acquisition + house improvement cost + transfer cost). In case of long-term capital gain, capital gain = final sale price – (transfer cost + indexed acquisition cost + indexed house improvement cost).

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How do I claim exemption under section 54?

Exemption under section 54 can be claimed in respect of capital gains arising on transfer of capital asset, being long-term residential house property. This benefit is available only to an individual or HUF. The benefit can be claimed by purchasing or by constructing a residential house.

Which of the following is included in the definition of transfer under section 2 subsection 47?

Transfer, in relation to capital asset, includes: the sale, exchange or relinquishment of the asset; or. the extinguishment of any rights therein; or. the compulsory acquisition thereof under any law; or.

What is transfer as per capital gain?

As per Section 2(47) “transfer” in relation to a capital asset includes: (i) sale, exchange or relinquishment of the asset, or. (ii) the extinguishment of any tight therein, or. (iii) the compulsory acquisition thereof under any law, or.

What is cost of acquisition in income tax?

Cost of Acquisition (COA) means any capital expense at the time of acquiring capital asset under transfer, i.e., to include the purchase price, expenses incurred up to acquiring date in the form of registration, storage etc. expenses incurred on completing transfer.

Is stipend taxable under Income Tax Act?

In the Income Tax Act from a purely factual standpoint there is no mention of ‘stipend’. ‘Salary’ received by an ’employee’ is taxable in the hands of the employee. … The Income Tax Act has further laid down that ‘scholarship granted to meet the cost of education’ is exempt from Income Tax under the section 10(16).

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Is VAT abolished in India?

The Goods and Services Tax (GST), which has replaced the Central and State indirect taxes such as VAT, excise duty and service tax, was implemented from 1st July 2017. … GST has eliminated the cascading effect of taxes on the economy.

What kind of tax is GST called as?

The goods and services tax (GST) is a value-added tax levied on most goods and services sold for domestic consumption. The GST is paid by consumers, but it is remitted to the government by the businesses selling the goods and services.

Who introduced VAT in India?

On 1 April 2005 the Government announced the introduction of a State VAT in 21 of the 29 Indian States. The new state-level VAT system replaced local sales taxes and was initially scheduled to commence on 1 April 2001.

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