Section 50B of ITA, 1961 : Section 50B: Special Provision For Computation Of Capital Gains In Case Of Slump Sale
ITA, 1961
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Explanation using Example
Imagine a company, XYZ Pvt. Ltd., that has been operating a textile manufacturing division for the past 5 years. The company decides to sell this division to another company, ABC Ltd., as it wants to focus on its core business of technology services. This sale includes all assets and liabilities related to the textile division and is agreed upon for a lump sum consideration without values being assigned to individual assets and liabilities. This is known as a "slump sale".
According to Section 50B of the Income-tax Act, 1961, the profit XYZ Pvt. Ltd. makes ...
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