Article
Slump exchange: The taxation battlefield
By Shalini Maheshwari and Aanchal Jain
The article in this issue of Direct Tax Amicus discusses at length the question as to whether ‘slump exchange’ is covered by the provisions of Section 50B of the Income Tax Act, 1961. According to the authors, the question that arises is whether only transfer as a result of ‘sale’ would be covered by the provisions of Section 50B or whether slump sale includes other forms of ‘transfer’ as well, as defined in Section 2(47). Another issue that comes to light is whether transfer for non-monetary consideration can constitute a ‘sale’. Analysing various Court decisions, the authors note that there is a conflict of opinion between various High Courts on the issue whether slump exchange is covered by the definition of ‘slump sale’ for the purposes of taxability under Section 50B. It is noted that these cases are pending before the Supreme Court and a final word on this vexed issue is eagerly awaited...
Notifications and Circulars
- Vivad se Vishwas scheme – Cut-off date for making payment extended again
- Transfer pricing – Tolerance range for AY 2020-21 notified
- Condonation of delay in filing of Form No. 10BB for AY 2016-17 and subsequent years
- Due dates for filing of Return and Tax Audit Report for AY 2020-21 extended
- Equalisation Levy Rules, 2016 amended
Ratio decidendi
- Consideration received from cashless exercise of stock option is taxable as capital gains – Karnataka High Court
- Proceeds from sale of audio and TV rights of film covered under ‘receipts from exhibition of films’ under Rule 9A – ITAT Bengaluru
- Transfer of rights in land and/or building not covered under Section 50C for calculation of capital gains – Section to be read strictly – ITAT New Delhi
- Mere location of inter-state Tribunal cannot decide jurisdiction of High Court to challenge that Tribunal’s order – Bombay High Court
- Tax on royalty income cannot be levied on aggregate basis – Sub-clauses of Section 115A(1)(b) are mutually exclusive and independent – Karnataka High Court
