If one wins a prize in kind eg. a car and pays the mandatory TDS, will there be any additional tax implication if:
i) the car is sold immediately on delivery for a price that is lower than the original market value of the car (once the car leaves the showroon, the market value already drops)?
ii) the car's model is exchanged for a higher end version and the incremental difference in market values is paid to the dealer?
Dear Menka
You need not to pay furrther taxes on transfer of you car.
As per section 2(14) of income tax act 1961 the personal Effect of movable nature assets are specially Excluded from the ambit of capital Assets Defination
- Wearing Apperals
- Furniture
- and Vehicle used by tax payer or dependent member of the tax payer.
So transfer of car used for personal perpose not atract capital gain liability
Naveen Fintech Pvt Ltd
Kolkata
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Gupta Sachdeva & Co. Chartered Accountants
New Delhi
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