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Capital gain

Tax queries 127 views 1 replies

vivek agarwal

owner

30 Points Joined June 2013

1. A proprietorship Firm having an immovable property, is being converted into partnership firm with other 2 partners having 80% shares and the earstwhile proprietor having 20% share only. Any capital gain tax on Immovable Property.

2. A Partnership Firm having an immovable property, is being converted into proprietorship Firm. Any capital gain tax on Immovable Property.

Replies (1)

CA Harshal Totla

Chartered Accountant

2229 Points Joined May 2014

clause xiii and xiv of section 47 says that there will be no capital gains on transfer of immovable property on conversion of properitorship concern/partnership concern into company if it satisfies certain conditions as laid out in those provisions, there is no specific exclusion from levy of capital gains on transfer of immovable property on conversion of properitorship concern into partnership firm or vice versa. Hence it will be regarded as transfer and capital gain levy will succeed.