I HAVE A QUERY REGARDING EXEMPTIONS THAT CAN BE AVAILED UNDER CAPITAL GAINS. PLEASE HELP URGENTLY
-> A SHAREHOLER OWNS A PRIVATE LIMITED COMPANY, NOW THE COMPANY IS BEING CLOSED DOWN, SO HE HAS SOLD THE PROPERTY OF THE COMPANY AND IS THUS GETTING MUCH CAPITAL GAIN TAX. BUT HE HAS USED THE SAME MONEY FOR PURCHASE OF ANOTHER LAND FOR STATING A PARTNERSHIP FIRM.
SO CAN HE CLAIM ANY EXEMPTION??
OR IS THERE ANY OTHER WAY TO SAVE GAPITAL GAIN TAX.
PLEASE HELP 
Dear Heena,
According to me, unfortunately, you will have to pay the Capital Gains Tax since, the Company is a completely different assessee from the owner. The land is sold by the Company and the investment is made by the owner thereof. The gain thus arises to the company, who is liable to pay tax on it
However, since the shares are bought back by the company, the company may also be required to pay tax u/s 115QA (which was inserted by Finance Act, 2013). And since, the consideration received by the owner on the buy back of the shares is exempt u/s 10(34A) of the Act, even 54 series of sections would not apply…
If you have any other doubts, please feel free to ask..
- Ankit
Naveen Fintech Pvt Ltd
Kolkata
CA Inter
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Gupta Sachdeva & Co. Chartered Accountants
New Delhi
CA Final
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