As per Section 45

Any Profit or Gain

on transfer 

 of  Capital asset

is Taxable under Income from capital gains.

in year of Transfer


When exempt under Section 54/54B/54D etc.


 Important Points

  • Capital Gain is applicable on Certain Assets only called Capital Asset (and not all assets)
  • Capital Gain is applicable on TRANSFER (Transfer not only includes Sale of Asset but also some other things which we will discuss later)
  • It is taxable in year Asset Transferred (Sold) and not purchased
  • Profit includes loss Also,so there can be loss on Sale of Captal Assets
  • Exemption of Capital Gain are mentioned in Section 54/54B/54D etc



Transfer+Capital Assets+ Not Exempt =Income/Loss from Capital Gain 



Lets study these points in detail one by one

  1. Income Tax
  2. Income from Capital Gains

About the Author

CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 11 years. He also provides Accounts Tax GST Training in Delhi and Pune.