Income Tax on "conversion" of firm into Pvt Ltd

Anoop Campbell (25 Points)

15 November 2022  

From income tax angle there is no capital gains tax on "conversion" of a firm into PVT LTD Co (transfer of assets and liabilities including fixed assets). My query is what is the treatment for stock? Will there be tax on transfer of stock held as stock in trade from firm to pvt ltd at the time of "conversion"?  Please quote relevant sections of IT Act.