Section - 50-CA - Fair Market Value to be
full value of consideration in certain cases -
Under the existing provisions of
the Act, income chargeable under the head "Capital gains" is computed
by taking into account the amount of full value of consideration received or
accrued on transfer of a capital asset. In order to ensure that the full value
of consideration is not understated, the Act also contained provisions for
deeming of full value of consideration in certain cases such as deeming of
stamp duty value as full value of consideration for transfer of immovable
property in certain cases.
In order to rationalise the
provisions relating to deeming of full value of consideration for computation
of income under the head "capital gains", it is proposed to insert a
new section 50CA to provide that where consideration for transfer of share of a
company (other than quoted share) is less than the Fair Market Value (FMV) of
such share determined in accordance with the prescribed manner, the FMV shall
be deemed to be the full value of consideration for the purposes of computing
income under the head "Capital gains".
The amendment will be effective
from 1st April 2018.