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capital gain on transfer of firm's property!

Ca Aashish Upadhyay (CONSULTANTS) (913 Points)

27 May 2010

KIndly explain the tax provision of capital gain on the transfer of the firm property!

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harish sharma (student) (58 Points)
Replied 27 May 2010

tax provision of capital gain on the transfer of the firm property section45(4)

The profits or gains arising from the transfer of a capital asset by way of distribution of capital assets on the dissolution of a firm or other association of persons or body of individuals (not being a company or a co-operative society) or otherwise , shall be chargeable to tax as the income of the firm, association or body, of the previous year in which the said transfer takes place and, for the purposes of

, the fair market value of the asset on the date of such transfer shall be deemed to be the full value of the consideration received or accruing as a result of the transfer.