transfer of capital asset to creditors is treated as transfer as per section 2 (47) of income tax act it will attract capital gain tax full value consideration is the consideration received or receivables by the transferor in lieu of assets, which he transferred in the above case it is amount settled between debtor and creditors
extremely regret for commenting on section 46 please give me some time to correct it
When you will see the Definition of Transfer u/s 2(47) then you could clearly see there that Transfer includes Exchange as well. So when you settle with your creditor against your assets then it will be treated as Transfer.
Sale Consideration for Co:- It will be the Value of Creditor against which the Assets has been transferred.
COA for Creditor:- The Value of Sale Consideration for Company shall be the COA in hands of Creditor.