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Income Tax Laws – I

Notes (a) the transfer is made in consideration of the allotment to him of any share or shares
in the amalgamated company except where the shareholders itself is the
amalgamated company, and the amalgamated company is an Indian company.
8. Any transfer of agricultural land in India effected before the first day of March, 1970.
9. Any transfer of a capital asset being any work of art, archaeological, scientific or art
collection, book, manuscript, drawing, painting, photograph or print to the Government
or a University or the National Museum, National Art Gallery, National Archives or any
such other public museum or institution as may be notified by the Central Government in
the Official Gazette to be of national importance or to be of renown throughout any State
or States any transfer by way of conversion of bonds or debentures, debenture stock or
deposit certificates in any form, of a company, into shares or debentures of that company.
10. Any transfer made on or before 31.12.1998 by a person not being a company of a capital
asset being membership of a recognised stock exchange to a company in exchange for
shares allotted by that company to him (transferor).

11. Any transfer of land by a sick industrial company made at any time beginning with
declaration of it being sick by the BIFR and ending with the previous year in which its net
worth wipes out the accumulated losses.
12. Where a firm is succeeded by a company in the business carried on by it as a result of
which the firm sells or otherwise transfers any capital asset or intangible asset to the
company: Any transfer of a capital asset or intangible asset by a firm to a company as a
result of succession of the firm by a company in the business carried on by the firm, or any
transfer of a capital asset to a company in the course of the demutualisation or
corporatisation of a recognised stock exchange in India as a result of which an association
of persons or body of individuals is succeeded by such company.
13. Any transfer of a capital asset being a membership right held by a member of a recognised
stock exchange in India for acquisition of shares and trading or clearing rights acquired by
such member in that recognised stock exchange in accordance with a scheme for
demutualisation or corporatisation which is approved by the Securities and Exchange
Board of India established under Section 3 of the Securities and Exchange Board of India
Act, 1992 (15 of 1992).
14. Any transfer of a capital asset or intangible asset by a private company or unlisted public
company (hereafter in this clause referred to as the company) to a limited liability
partnership or any transfer of a share or shares held in the company by a shareholder as a
result of conversion of the company into a limited liability partnership.

15. Where a sole proprietary concern is succeeded by a company in the business carried on by
it as a result of which the sole proprietary concern sells or otherwise transfers any capital
asset or intangible asset to the company.
16. Any transfer in a scheme for lending of any securities under an agreement or arrangement,
which the assessee has entered into with the borrower. Of such securities and which is
subject to the guidelines issued by the Securities and Exchange Board of India, established
under Section 3 of the Securities and Exchange Board of India Act, 1992 or the Reserve Bank
of India in this regard.
17. Any transfer of a capital asset in a transaction of reverse mortgage under a scheme made
and notified by the Central Government.
Thus, transfer of capital assets falling in any of the categories discussed above would not attract
liability to capital gains tax.

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