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| The Tax Publishers2020 TaxPub(DT) 2108 (Pune-Trib) INCOME TAX ACT, 1961
Section 45 read with section 50C
Deeming fiction attached to section 50 has to be restricted only for method of computing capital gain and cannot be read into while considering the case for non-chargeability of capital gain.
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Capital gains - Applicable rate of tax - Deeming fiction pertaining to section 50 whether only restricted to method of computing capital gain -
Assessee-company was engaged in business of software development and sales and support services. While framing scrutiny assessment, AO computed Short Term Capital Gain under section 50 of the Income-tax Act, 1961 taking tax rate of 30% as against 20% claimed by assessee. Held: Deeming fiction attached to section 50 has to be restricted only for method of computing capital gain and cannot be read into while considering the case for non-chargeability of capital gain.
Followed:CIT v. Velvet Holdings Pvt. Ltd. [Income Tax Appeal No.165 of 2015, dated 10-7-2017]; CIT v. Ace Builders (P.) Ltd. (2006) 281 ITR 210 (Bom-HC) : 2006 TaxPub(DT) 0283 (Bom-HC); CIT v. V.S. Dempo Company Ltd. (2016) 74 Taxmann.com 15 (SC) : 2016 TaxPub(DT) 4318 (SC)
REFERRED :
FAVOUR : In assessee's favour
A.Y. :
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