New Sec 15BAA for Companies

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This discussion addresses a company selling land acquired at Rs 3.75 Cr for Rs 12.50 Cr, and whether to opt for Section 115 BAA. Key questions include the timing of the election, MAT applicability, capital gains tax rates, indexation benefits, and the utilisation of brought forward losses under the new regime. The consensus is that the election can be made later, MAT is applicable, capital gains are taxed at 20%, indexation is allowed, and brought forward losses can be set off. It's also clarified that tax is payable on the higher of the normal tax or MAT rate.

VIPIN GUPTA

VIPIN GUPTA (Querist)
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18 November 2020 Sir, one of our client is a company it has not started its business since inception. in there only land and building and no depreciation is charged since inception its book value is Rs 3.75 Cr. Now we are selling that land for Rs 12.50 Cr. I want to Ask
1. Do we have to exercise to option of Sec 115 BAA this year itself i.e while filing ITR of A/y 2020-21 as in next year this window will be closed. or can be apply next year also.
2. Will MAT be applicable on this capital gain if we remain in old regime.
3. Will Capital gain be taxed at normal 20% slab whether we are in old provision or Sec 115 BAA.
4. Whether indexation be allowed to us as no depreciation is claimed.
5. If we go for new scheme we are having brought forward loss of Rs 26.50 Lacs can we setoff it under new Sec 115BAA As the Sec Blocks Sec 72A losses and not Sec 72

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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18 November 2020 1 you can apply next year also window will not be closed.
2 yes MAT applicable.
3 Capital gain will be taxed at normal 20% slab whether you are in old provision or Sec 115 BAA.
4 yes Indexation allowed.
5 yes you can claim allowed losses.